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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
 
FORM
10-K
 
(Mark
One)
 


☒
ANNUAL
    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 
For
the fiscal year ended March 31, 2024
 
or
 


☐
TRANSITION
    REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 
For
the transition period from ________ to ________
 
Commission
file number: 000-50547
 
SUNDANCE
STRATEGIES, INC.
(Exact
name of registrant as specified in its charter)
 


Nevada
 
88-0515333

(State
    or other jurisdiction
of
    incorporation or organization)
 
(I.R.S.
    Employer
Identification
    No.)

 
 
 

4626
    North 300 West, Suite No. 365, Provo, Utah
 
84604

(Address
    of principal executive offices)
 
(Zip
    Code)

 
(801)
717-3935
(Registrant’s
telephone number, including area code)
 
Securities
registered pursuant to section 12(b) of the Exchange Act:
None
 
Securities
registered pursuant to Section 12(g) of the Act:
 


Title
    of each class
 
Trading
    Symbol(s)
 
Name
    of each exchange on which registered

Common
    Stock, $0.001 par value
 
SUND
 
OTCQB

 
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
 
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐
No ☒
 
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2)
has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
 
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files.) Yes ☒ No ☐
 
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting
company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller
reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 


 
Large
    accelerated filer ☐
Accelerated
    filer ☐

 
Non-accelerated
    filer ☒
Smaller
    reporting company ☒

 
 
Emerging
    Growth Company ☒

 
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒
 
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered
public accounting firm that prepared or issued its audit report. ☐

 
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements.(1) ☐

 
Indicate
by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b) .(1)
☐

 
(1) Not
applicable.

 
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) Yes ☐ No ☒
 
As
of July 1, 2024 the registrant had 42,438,441 shares of common stock, par value $0.001, issued and outstanding. The aggregate market
value of common shares held by non-affiliates as of September 30, 2023 (the most recent second quarter), was $8,985,742. The total number
of shares of common stock beneficially owned by executives, directors, and 10% stockholders as of March 31, 2024, and September 30, 2023,
is 32,665,092 and 30,630,063 respectively.
 
Documents
incorporated by reference.
 
None.
 
 
 

 
 

 
Table
of Contents
 


 
PART I
 

 
 
 

Item
    1.
Business
4

 
 
 

Item
    1A.
Risk Factors
7

 
 
 

Item
    1B.
Unresolved Staff Comments
25

 
 
 

Item
    1C.
Cybersecurity
25

 
 
 

Item
    2.
Properties
25

 
 
 

Item
    3.
Legal Proceedings
25

 
 
 

Item
    4.
Mine Safety Disclosures
25

 
 
 

PART II

 
 
 

Item
    5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
26

 
 
 

Item
    6.
Selected Financial Data
27

 
 
 

Item
    7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
27

 
 
 

Item
    8.
Financial Statements and Supplementary Data
31

 
 
 

Item
    9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
32

 
 
 

Item
    9A.
Controls and Procedures
32

 
 
 

Item
    9B.
Other Information
33

 
 
 

Item
    9C.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
33

 
 
 

PART III

 
 
 

Item
    10.
Directors, Executive Officers and Corporate Governance
34

 
 
 

Item
    11.
Executive Compensation
37

 
 
 

Item
    12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
39

 
 
 

Item
    13.
Certain Relationships and Related Transactions, and Director Independence
41

 
 
 

Item
    14. 
Principal Accounting Fees and Services
43

 
 
 

PART IV

 
 
 

Item
    15. 
Exhibits and Financial Statement Schedules
44

 
 
 

Item
    16. 
Form 10-K Summary
45

 
 
 

 
Signatures
46

 

2
 

 
SUNDANCE
STRATEGIES, INC.
 
In
this Annual Report, references to “Sundance,” the “Company,” “we,” “us,” “our”
and words of similar import refer to Sundance Strategies, Inc., a Nevada corporation and its wholly-owned subsidiary, ANEW LIFE, INC.,
a Utah corporation (“ANEW LIFE”), unless the context requires otherwise.
 
Information
Concerning Forward-Looking Statements
 
This
annual report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,
(the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
that are based on management’s beliefs and assumptions and on information currently available to management. For this purpose,
any statement contained in this report that is not a statement of historical fact may be deemed to be forward-looking, including, but
not limited to, statements relating to our future actions, intentions, plans, strategies, objectives, results of operations, cash flows
and the adequacy of or need to seek additional capital resources and liquidity. Without limiting the foregoing, words such as “may”,
“should”, “expect”, “project”, “plan”, “anticipate”,
“believe”, “estimate”, “intend”, “budget”, “forecast”,
“predict”, “potential”, “continue”, “should”, “could”,
“will” or comparable terminology or the negative of such terms are intended to identify forward-looking statements,
however, the absence of these words does not necessarily mean that a statement is not forward-looking. These statements by their nature
involve known and unknown risks and uncertainties and other factors that may cause actual results and outcomes to differ materially depending
on a variety of factors, many of which are not within our control. Such factors include, but are not limited to, economic conditions
generally and in the industry in which we and our customers participate; competition within our industry; legislative requirements or
changes which could render our products or services less competitive or obsolete; our failure to successfully develop new products and/or
services or to anticipate current or prospective customers’ needs; price increases; employee limitations; or delays, reductions,
or cancellations of contracts we have previously entered into; sufficiency of working capital, capital resources and liquidity and other
factors detailed herein and in our other filings with the United States Securities and Exchange Commission (the “SEC” or
“Commission”). Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect,
actual outcomes may vary materially from those indicated.
 
Forward-looking
statements are predictions and not guarantees of future performance or events. Forward-looking statements are based on current industry,
financial and economic information which we have assessed but which by its nature is dynamic and subject to rapid and possibly abrupt
changes. Our actual results could differ materially from those stated or implied by such forward-looking statements due to risks and
uncertainties associated with our business. Although we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we nor any other person
assumes responsibility for the accuracy and completeness of these forward-looking statements, and we hereby qualify all our forward-looking
statements by these cautionary statements.
 
These
forward-looking statements speak only as of their dates and should not be unduly relied upon. We undertake no obligation to amend this
report or revise publicly these forward-looking statements (other than pursuant to reporting obligations imposed on registrants pursuant
to the Exchange Act) to reflect subsequent events or circumstances, whether as the result of new information, future events or otherwise.
 
The
following discussion should be read in conjunction with our financial statements and the related notes contained elsewhere in this report
and in our other filings with the Commission.
 

3
 

 
PART
I
 
Item
1. Business
 
Organizational
Background
 
Java
Express, Inc., was organized under the laws of the State of Nevada on December 14, 2001, for the purpose of selling coffee and other
related items to the general public from retail coffee shop locations. These endeavors ceased in 2006, and it had no material business
operations from 2006 until March of 2013. On March 29, 2013, the Company, its newly formed and wholly-owned subsidiary, Anew Acquisition
Corp., a Utah corporation (“Merger Sub”), and ANEW LIFE, INC., a Utah corporation (“ANEW LIFE”), executed and
delivered an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which Merger Sub merged with and into ANEW
LIFE, ANEW LIFE was the surviving company under the merger and became a wholly-owned subsidiary of the Company on the closing of the
merger (the “Merger”). On April 17, 2013, the Company filed a Certificate of Amendment with the Secretary of State of the
State of Nevada to change its name from “Java Express, Inc.” to “Sundance Strategies, Inc.” Sundance Strategies,
Inc. is referred to as the Company, us or we.
 
Our
Business
 
Our
historical business model has focused on purchasing or acquiring life insurance policies and residual interests in or financial products
tied to life insurance policies, including notes, drafts, acceptances, open accounts receivable and other obligations representing part
or all of the sales price of insurance, life settlements and related insurance contracts being traded in the secondary marketplace, often
referred to as the “life settlements market.”
 
We
currently do not hold life settlement or life insurance policies but, rather, previously held a contractual right to receive the net
insurance benefits, or “NIBs”, from a portfolio of life insurance policies held by a third party (“the Owners”
or “the Holders”). These NIBs represented an indirect, residual ownership interest in a portfolio of individual life insurance
policies, and they allowed us to receive a portion of the settlement proceeds from such policies, after expenses related to the acquisition,
financing, insuring and servicing of the policies underlying our NIBs have been paid.
 
NIBs
are generally sold by an entity that holds the underlying life settlement or life insurance policies, either directly or indirectly through
a subsidiary, such an entity being referred to herein as a “Holder.” A Holder, either directly or through a wholly owned
subsidiary, purchases life insurance policies either from the insured or on the secondary market and aggregates them into a portfolio
of policies. At the time of purchase, the Holder also (i) contracts with a service provider to manage the servicing of the policies until
maturity, (ii) consider purchasing mortality re-insurance (“MRI”) coverage under which payments will be made to the Holder
in the event the insurance policies do not mature according to actuarial life expectancies, and (iii) arranges financing to cover the
initial purchase of the insurance policies, the servicing of the life insurance policies until maturity and the payment of the MRI premiums.
The financing obtained by the Holder for a portfolio of life settlement or life insurance policies is secured by the insurance policies
for which the financing was obtained. After a Holder purchases policies, aggregates them into a portfolio and arranges for the servicing,
MRI coverage and financing, the Holder contracts to sell NIBs related to the policies, which gives the holder of the NIBs the right to
receive the proceeds from the settlement of the insurance policies after all of the expenses related to such policies have been paid.
When an insurance policy underlying our NIBs comes to maturity, the insurance proceeds are first used to pay expenses associated with
such policy. Once all of the expenses have been paid, the Holder will retain a small percentage of the proceeds and then will pay the
remaining insurance proceeds to us.
 
During
the latter part of the fiscal year ended March 31, 2021, we began developing an additional business offering, providing professional
services to specialty structured finance groups, bond issuers and life settlement aggregators. We have assembled an experienced team
from the life settlement marketplace, as well as from other areas such as financial services and public financial markets. As a professional
services provider, we apply industry best practices to advise on the selection of specific portfolios of life insurance policies that
are tailored to meet the needs of its clients. Our clients may include bond issuers, bond investors, or other structured finance product
issuers. We develop strategies and methodologies which include the acquisition of life insurance portfolios, then use common structured
finance techniques and proprietary analytics to structure bonds for issuances, including principal protected bonds. Our goal is to deliver
long-term value and profitability to shareholders by growing our professional services business and asset base, resulting in the ability
to pay dividends to its shareholders.
 

4
 

 
During
the latter part of the year ended March 31, 2021, we began working closely with bond placement agents and aggregators to establish various
aspects of a proprietary, investment grade bond offering. In this arrangement, we participate as the sole originator in the role of structuring
and advising on the structure of the proprietary bond instrument. Included in the role of structuring financial assets, we use proprietary
analytics to establish the makeup of the rated instrument, including but not limited to, life settlement assets (life insurance policies)
and managed cash, and implements a process of selective assembly of the underlying assets and cash management that will meet the policy
requirements and analytics. We provide current and ongoing resources for all analytics, as well as advisement support for the investment
and non-investment grade ratings for the managed asset pool and the managed cash accounts. In our advisory role, we are reimbursed for
all expenses associated with the structuring and preparation of any bond offering, will receive an advisory payment upon the closing
of any bond offering, and then will hold residual rights on the balance of assets once the bond is retired.
 
On
January 1, 2022, we entered into a marketing and consulting agreement with Tradability, LLC (“Consultant”) that required
us to make an initial $100,000 payment and up to an additional $400,000 in the future (which will be financed by the Consultant via a
promissory note). The $400,000 obligation is contingent upon the Consultant and us successfully reaching certain milestones. Further,
the agreement requires us to issue between 1,000,000 and 10,000,000 stock options (which are exercisable into our common stock at prices
between $1.00 to $2.50 per share) contingent upon the Consultant and us successfully reaching certain milestones. The milestones primarily
relate to the Consultant finalizing the tokenization of 500 million non-fungible tokens (“NFTs”) and the successful placement
of NFTs with proceeds of between $100 million and $500 million. The proceeds will be used to purchase Life Settlements for which we will
be an advisor. As of the issuance of these financial statements, none of the milestones related to the potential issuance of equity have
been met. This Company has terminated this agreement with Tradability, and no future payments are expected in association
with this terminated agreement.
 
Life
Settlements Market
 
There
are a number of reasons a policy owner may choose to sell his or her life insurance policy. The policy owner may no longer need or want
his or her policy, he or she may wish to purchase a different kind of insurance policy, premium payments may no longer be affordable
or the policy owner may need cash to fund healthcare or other expenses. In particular, policy holders 65 years of age and older and their
families are faced with a variety of challenges as they seek to address their post-retirement financial needs and selling one’s
life insurance policy may provide a unique and valuable financial solution to such challenges. From the early 2000s through 2008, the
market for newly originated life settlements grew from virtually no activity to a peak of an estimated $12 billion of face value of U.S.
life settlement policies settled annually in 2007 and 2008. Economic factors slowed the growth in 2009, when an estimated $8 billion
of face value of U.S. life insurance was settled and growth has continued to decline since that time. Participants in the secondary life
settlement market have included major insurance companies which have purchased available pools of policies for their own investment,
portfolio aggregators, private equity funds, and independent third-party investors.
 
Predictability
of Future Cash Flows. Predictability of future cash flows is one of the biggest challenges facing companies engaged in the life
settlements industry. If a Holder is not able to adequately predict future cash flows and does not continually have enough cash to make
a policy portfolio’s premium payments, the policies in the portfolio may lapse and we may lose our right to receive the proceeds
from the settlement of the policies at maturity. Prediction of future cash flow requires the use of financial models, which rely on various
assumptions. These assumptions include the amount and timing of projected net cash receipts, expected maturity events, counter party
performance risk, changes to applicable regulation of the investment, shortage of funds needed to maintain the asset until maturity,
changes in discount rates, life expectancy estimates and their relation to premiums, interest, and other costs incurred, among other
items. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact our estimates
and interest income. As a result, actual results could differ significantly from those estimates. If projections of life expectancies
are wrong, Holders may be obligated to service the related insurance policies for longer than expected, thereby increasing their costs
and reducing the net insurance benefit available.
 

5
 

 
Financing
a portion of the purchase price. Financing a portion of the purchase price of a policy portfolio allows the Holder to leverage
its investment and create a larger and diversified policy portfolio. When making an investment in a portfolio of life insurance policies,
a Holder utilizes actuarial tables to determine when the policies in the portfolio can be expected to come to maturity. However, the
Holder assumes the risk that the policies in the portfolio will come to maturity later than was predicted by the actuarial tables used
at the time of purchase. The life expectancies provided by the actuarial tables are based on actual death rates in large populations
of individuals with similar demographic characteristics. Thus, the more policies underlying a policy portfolio, the more reliable the
use of actuarial tables becomes. In other words, the larger the policy portfolio, the more closely the underlying insureds would be expected
to, on average, follow actuarial predictions and the lower the risk associated with future cash flows will be. Because of the general
uncertainty of maturity of life insurance policies, financing for their purchase and servicing has historically been difficult to secure.
The lender (the “Holders’ Lender”) has provided financing to the Holders to finance the purchase of the insurance policies.
We believe there are few lenders within this market.
 
Mortality
Re-Insurance (MRI) Coverage. Because of the uncertainty of maturity of insurance policies the Holders had, on occasion, previously
contracted with an insurance provider for MRI coverage. MRI coverage typically provides guaranteed cash flow based on the expected death
benefits of the pool of policies being insured calculated at the issuance of the coverage and thereby provides credit enhancement to
any bank providing financing to a Holder. The term of the MRI policies is usually 15 years. Any claims paid by the MRI to the Holder
must be paid back to the MRI provider out of death benefit proceeds from the pool of policies being insured when such death benefit proceeds
are eventually received. This enables the Holder to receive a smoother cash flow from a pool of policies over time and avoid “lumpiness”
in the cash flows that would otherwise be more pronounced in the absence of the MRI coverage. Any claim payment balances would accrue
interest, typically at a spread of 250 basis points over LIBOR, to the extent they remain outstanding. The MRI coverage is obtained by
paying an MRI premium, typically at equal to 2% of the cumulative death benefit of the covered life insurance policies, at the outset
of the coverage and, depending on the specific terms of the MRI policy, possibly an additional premium amount at a predetermined time
during the effective coverage period (the “Commitment Fee”), which is typically 1% of the cumulative death benefits of the
covered policies. The insurer under the MRI policy typically must approve the sale of any life insurance policies covered by the MRI
policy if such sale does not result in the full repayment of any outstanding recovery amounts. It is our understanding that there is
only one MRI Provider. While the MRI coverage is relatively expensive, we believe that insurance policies that are covered by MRI have
less volatility, are more liquid and should achieve higher values for purposes of financing and secondary market sales.
 
Financing
a policy portfolio’s premium payments gives a Holder additional cash needed to satisfy the premium obligations of its portfolio.
In addition, obtaining MRI increases the probability that the Holder will receive future cash flows in the event the underlying insureds
live longer than expected. This combination provides the Holder with sufficient liquidity to stabilize its cash position.
 
Life
Settlement Purchasing Guidelines as an Advisor
 
Our
objective is to advise and assist entities as they acquire Life Insurance policies and portfolios that will produce returns in excess
of any and all purchase, financing, servicing and insuring costs incurred by the Holder. The guidelines we generally follow regarding
the purchase of policies and portfolios include:
 


 
●
the
    insured is 75 years old or older;

 
●
all
    NIBs relate to U.S. Universal Life Insurance policies;

 
●
all
    underlying insurance policies have qualified for financing that will cover at least four years of premiums;

 
●
each
    policy must first be reviewed by the legal due diligence team of the lender providing financing for the acquisition and servicing
    of the life insurance policies, second by the MRI company’s due diligence team and then finally approved by our due diligence
    processes;

 
●
all
    policies must qualify for MRI; and

 
●
the
    projected proceeds payable on each life insurance policy upon the death of the underlying insured are projected to exceed the costs
    to service the life insurance policies, amounts due to creditors secured by such life insurance policy, such as the Holders’
    Lender or the MRI provider, other costs and fees incurred by the Holder and the percentage of the remaining insurance benefit retained
    by the Holder 

 

6
 

 
Competition
 
We
encounter significant competition in the life settlements industry generally from numerous companies, including hedge funds, investment
banks, secured lenders, specialty life insurance finance companies and life insurance companies themselves who purchase life settlements.
Many of these competitors have greater financial and other resources than we do and may have a significantly lower cost of funds because
they have greater access to insured deposits or the capital markets. Moreover, some of these competitors have significant cash reserves
and can better fund shortfalls in collections that might have a more pronounced impact on companies such as ours. They also have greater
market share. For example, Berkshire Hathaway purchased a portfolio of $300 million (face value) in life insurance policies in 2013.
According to The Deal Pipeline, total life settlement transactions grew to $2.57 billion (face value) in 2013. In 2014 transaction
volumes were reported higher by market participants in all major segments of the industry and Conning & Co. forecast an average annual
gross market potential for life settlements of $180 billion from 2014-2023, with an average volume of approximately $3 billion per year
in life settlement transactions.
 
A
report from the AAP Life Settlement Market Update indicated that internal rates of return for life settlement transactions conducted
in 2013 were in the high-teens, an attractive return at a time when fixed income and other hedge positions were delivering minimal rates
of return. In the event that certain better-financed companies make a significant effort to compete against our business or the secondary
market in general, prices paid for existing portfolios of life insurance policies may rise and our ability to purchase satisfactory assets
may decline. In addition, recent shrinking of the market for life settlements has resulted in fewer available pools of insurance policies.
As a result, price competition for the remaining pools has increased. Our limited resources prohibit us from competing for larger pools.
These factors could adversely affect our profitability by reducing our return on investment or increasing our risk.
 
Employees
 
On
March 31, 2024, we had one full-time employee: Randall F. Pearson, our President.
 
Available
Information
 
Our
website address is www.sundancestrategies.com. We make available free of charge on the Investor Relations portion of our website, our
annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as reasonably practicable after we electronically file
such material with, or furnish it to, the Securities and Exchange Commission.
 
Item
1A. Risk Factors
 
We
have identified the following risks and uncertainties that may have a material adverse effect on our business, financial condition, results
of operations and future growth prospects. Our business could be harmed by any of these risks. The risks and uncertainties described
below are not the only ones we face. The trading price of our common stock could decline due to any of these risks, and you may lose
all or part of your investment. In assessing these risks, you should also refer to other information contained in this Form 10-K, including
our consolidated financial statements and related notes.
 

7
 

 
Summary
of Risk Factors
 
Our
business is subject to a number of risks and uncertainties including those described at length in the Risk Factors section below. We
consider the following to be our most material risks:
 
Risks
Relating to Our Business
 


 
●
We
    have historically used significant amounts of cash in operating activities since our inception and may continue to use significant
    amounts of cash for operating activities in the foreseeable future.

 
●
We
    may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs and our failure to
    obtain additional financing when needed could force us to delay, reduce or eliminate our product development programs and commercialization
    efforts or cause us to become insolvent.

 
●
There
    may be substantial doubt about our ability to continue as a going concern, and we will need additional financing to execute our business
    plan, to fund our operations and to continue as a going concern.

 
●
We
    may default on our obligations under various debt arrangements, which may accelerate our repayment obligations or otherwise limit
    our access to future financing.

 
●
We
    are pursuing opportunities relating to the tokenization and sale of digital assets that are subject to volatile market prices, impairment
    and unique risks of loss.

 
●
Our
    management team relies on outside consultants and others in our industry to make informed business decisions; potential conflicts
    of interest involving those parties who are relied upon could adversely affect the execution of our business model.

 
●
Current
    and future federal regulation under the Dodd-Frank Act’s consumer protection provisions may have an adverse effect on our business
    and our planned business operations.

 
●
General
    economic conditions could have an adverse effect on our business.

 
●
The
    costs in time and expense of being a publicly-held company are substantial and will only increase if our business model is successful.

 
●
Inadequate
    funding will impede execution of our business model.

 
●
We
    are new to the bond, life settlement, and financial advisory industry and may not be able to successfully compete in this industry.

 
●
Historically,
    99% of our total assets are interests in life settlement policies, resulting in a lack of diversification of assets and concentration
    in assets that are subject to significant fluctuations in value.

 
●
Limitations
    to the financial model we use may result in inaccurate or incomplete projections of future cash flow from the insurance policies.

 
●
The
    individuals insured by the life insurance policies may live longer than their actuarial life expectancies and thereby, cash flows
    from life insurance policies may be delayed.

 
●
Having
    relatively few insureds could cause the overall performance to be unduly influenced by a relatively small number of underlying policies
    that perform better or worse than expected.

 
●
Increased
    general market interest rates could increase the carrying costs of the life insurance policies and reduce the related cash flows.

 
●
Changes
    to foreign banking laws and regulations or decreased lending capacity for life settlements could have a negative impact on ability
    of Holders to obtain loans with respect to purchases of life settlements.

 
●
Holders
    may be required to obtain MRI coverage as a condition of our business model, which, if unavailable, could potentially increase our
    risk of failure.

 
●
The
    lapse of life insurance policies will result in the entire loss of our interest in the death benefits from those particular policies.

 
●
Actual
    results from life settlement products may not match expected results, which could reduce returns and also adversely affect the ability
    to service and grow a portfolio for actuarial stability.

 
●
The
    limited number of sellers of life settlement products in the secondary market may limit the ability to negotiate favorable prices
    in the acquisition of such life settlement interests.

 
●
We
    do not track concentrations of pre-existing medical conditions of insureds in our guidelines for purchasing life settlement products.

 
●
If
    life settlement products are determined to be “securities,” Holders may be required to register as an investment company
    under the Investment Company Act, which would substantially increase SEC reporting costs and oversight of a Holder’s business
    operations.

 
●
There
    is poor liquidity in the secondary market for life insurance and life settlements.

 
Risks
Related to the Life Insurance Policies
 


 
●
Life
    settlements, and therefore our common stock, are highly speculative and may lose all of their value.

 
●
Policies
    may be determined to have been issued without an “insurable interest” and could be void or voidable.

 
●
Additional
    insurable interest concerns regarding life insurance policies originated pursuant to premium finance transactions may also result
    in adverse decisions that could effect policies.

 

8
 

 


 
●
Fraud
    in the application for life insurance can also affect assets and interest in policies.

 
●
The
    risk of litigation with issuing insurance companies could substantially raise our costs of operation and increase our risk of loss.

 
●
The
    contestation of the life insurance policies by the applicable issuing insurance companies could result in the loss of the benefits
    from such life insurance policies.

 
●
Increases
    in cost of insurance could reduce estimated returns and lower revenues.

 
●
Carrier
    and service partner credit risk can adversely affect life settlements.

 
●
The
    inability to keep track of the insureds could keep us from updating the medical records of the insured.

 
●
Lost
    insureds can result in a delay or a loss of an insurance benefit that would have a negative effect on revenues and prospects.

 
●
U.S.
    life settlement and viatical regulations may result in determination(s) of applicable law violations.

 
●
State
    protections for the insolvency of an insurance company are limited.

 
●
Liability
    for failing to comply with U.S. privacy safeguards.

 
●
Cyber-attacks
    or other security breaches could have a material adverse effect on our business.

 
●
U.S.
    privacy concerns may affect the access to accurate and current medical information regarding the insured under life insurance policies.

 
Risk
Factors Related to Our Common Stock
 


 
●
There
    is a limited public market for our common stock, and any market that may develop could be volatile.

 
●
We
    are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies
    will make our common stock less attractive to investors.

 
●
Our
    management and two stockholders beneficially own approximately 66% of our outstanding common stock and therefore can exert control
    over our business.

 
●
Future
    sales of our common stock could adversely affect our stock price and our ability to raise capital in the future, resulting in our
    inability to raise required funding for our operations.

 
Risk
Factors relating to Our Business
 
We
have historically used significant amounts of cash in operating activities since our inception and may continue to use significant amounts
of cash for operating activities in the foreseeable future.
 
We
have historically used substantial amounts of cash in operating activities. To date, our operations have not generated sufficient cash
flow to fund our operations and we have relied on cash provided by financing activities, including amounts received under notes payable
and lines-of-credit with related parties. Our default under these obligations may also limit our ability to obtain future financing from
related or third parties.
 
Our
inability to access capital may limit our ability to adequately fund our operations. In order to continue to fund our operations, including
the potential purchase of NIBs, we will need to raise substantial amounts of capital. Absent additional financing, we will not have the
resources to execute our business plan.
 
We
may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs and our failure to obtain
additional financing when needed could force us to delay, reduce or eliminate our product development programs and commercialization
efforts or cause us to become insolvent.
 
We
will need to raise additional funds through future equity or debt financings in the near future to meet our operational needs and capital
requirements. We can provide no assurance that we will be successful in raising funds pursuant to additional equity or debt financings
or that such funds will be raised at prices that do not create substantial dilution for our existing stockholders. Given the volatility
of our stock price, any financing that we undertake could cause substantial dilution to our existing stockholders.
 
To
date, we have financed our operations primarily through net proceeds from the issuance of capital stock and debt financings. We do not
know when or if our operations will generate sufficient cash to fund our ongoing operations. We cannot be certain that additional capital
will be available as needed on acceptable terms, or at all.
 

9
 

 
We
may raise additional funds in equity or debt financings or enter into credit facilities in order to access funds for our capital needs.
Any debt financing obtained by us in the future would cause us to incur additional debt service expenses and could include restrictive
covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for
us to obtain additional capital and pursue business opportunities. In addition, future equity investors may require that we convert all
or a portion of our debt to equity, and our debtholders may not agree to such terms. If we raise additional funds through further issuances
of equity or convertible debt securities, and/or if we convert all or a portion of our existing debt to equity, our existing stockholders
could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights,
preferences and privileges senior to those of holders of our common stock. If we are unable to obtain adequate financing or financing
on terms satisfactory to us when we require it, we may significantly scale back our operations or we may become insolvent. If this were
to occur, our ability to continue to grow and support our business and to respond to business challenges could be significantly limited.
 
There
may be substantial doubt about our ability to continue as a going concern, and we will need additional financing to execute our business
plan, to fund our operations and to continue as a going concern.
 
Since
inception, we have experienced recurring operating losses and negative cash flows and we expect to continue to generate operating losses
and consume significant cash resources for the foreseeable future. There may be substantial doubt regarding our ability to continue as
a going concern. We have prepared our financial statements on a going concern basis, which contemplates the realization of assets and
the satisfaction of liabilities and commitments in the normal course of business. Our financial statements for the fiscal year ended
March 31, 2024 do not include any adjustment to reflect the possible future effects on the recoverability and classification of assets
or the amounts and classification of liabilities that may result from the outcome of this uncertainty, with the exception that all borrowings
are classified as current on the balance sheets.
 
Our
inability to access capital may limit our ability to adequately fund our operations and continue as a going concern. To continue as a
going concern we will need to raise substantial amounts of capital. Absent additional financing, we will not have the resources to execute
our business plan and continue as a going concern.
 
Inadequate
funding will impede execution of our business model.
 
At
present, we are a minor participant in both the life settlement market and in the bond advisory industry. We face significant competition
from much larger competitors. We will need substantial additional funds to effectively compete in these industries, and no assurance
can be given that we will be able to adequately fund our current and intended operations. We expect to finance our operating working
capital requirements, with proceeds from planned public and/or private offerings of our securities and debt financing. There can be no
assurance that we will be successful in raising debt or equity capital or that we will be successful in raising additional capital in
the future on terms acceptable to us, or at all. If we are not able to obtain sufficient funding to execute our business strategies,
we may be required to scale back or discontinue our operations, which would materially adversely affect our financial condition and results
of operations.
 
We
may default on our obligations under various debt arrangements, which may accelerate our repayment obligations or otherwise limit our
access to future financing.
 
If
we fail to make timely repayments of amounts received under notes payable and lines-of-credit with related parties or the 8% convertible
debenture agreement we will be in default of such obligations, which could materially adversely affect our operations and financial condition.
Our default under these obligations may also limit our ability to obtain future financing from related or third parties, which would
materially adversely affect our operations and our ability to execute our business strategy.
 

10
 

 
We
are pursuing opportunities relating to the tokenization and sale of digital assets that are subject to volatile market prices, impairment
and unique risks of loss.
 
We
are exploring opportunities to pursue the tokenization and sale of non-fungible tokens (“NFTs”). There is no guarantee that
we will be able to successfully tokenize and sell such NFTs, and our use of NFTs exposes us to additional risks.
 
The
prices of digital assets have been in the past and may continue to be highly volatile due to various associated risks and uncertainties.
For example, the prevalence of such assets is a relatively recent trend, and their long-term adoption by investors, consumers, and businesses
is unpredictable. Moreover, their lack of a physical form, their reliance on technology for their creation, existence and transactional
validation and their decentralization may subject their integrity to the threat of malicious attacks and technological obsolescence.
As a result, the value that we may realize, if any, from the sale of NFTs is uncertain.
 
Digital
assets, as intangible assets without centralized issuers or governing bodies, have been, and may in the future be, subject to security
breaches, cyberattacks or other malicious activities, as well as human errors or computer malfunctions that may result in the loss or
destruction of private keys needed to access such assets. While we intend to take all reasonable measures to secure any digital assets,
if such threats are realized or the measures or controls we create or implement to secure our digital assets fail, it could result in
a partial or total misappropriation or loss of our digital assets, and our financial condition and operating results may be harmed.
 
At
this time, the regulation of digital assets and NFTs remains in an early stage. The extent to which securities laws or other regulations
apply or may apply in the future to such assets is unclear at this time. However, on March 9, 2022, the White House issued an Executive
Order on Ensuring Responsible Development of Digital Assets proposing, among other things, regulation of digital assets. Future regulation
of such assets may increase our compliance costs or adversely impact our business.
 
NFTs
may also be subject to regulations of the Financial Crimes Enforcement Network (“FinCEN”) of the U.S. Department of Treasury
and the Bank Secrecy Act. Further, the Office of Foreign Assets Controls (“OFAC”) has signaled sanctions could apply to digital
transactions and has pursued enforcement actions involving cryptocurrencies and digital asset accounts. The nature of many NFT transactions
also involve circumstances which present higher risks for potential violations, such as anonymity, subjective valuation, use of intermediaries,
lack of transparency, and decentralization associated with blockchain technology. In addition, the Commodity Futures Trading Commission
has stated that cryptocurrencies, with which NFTs have some similarities, fall within the definition of “commodities.” If
NFTs were deemed to be a commodity, NFT transactions could be subject to prohibitions on deceptive and manipulative trading or restrictions
on manner of trading (e.g., on a registered derivatives exchange), depending on how the transaction is conducted. Moreover, if NFTs were
deemed to be a “security,” it could raise federal and state securities law implications, including exemption or registration
requirements for marketplaces for NFT transactions, sellers of NFTs, and the NFT transactions themselves, as well as liability issues,
such as insider trading or material omissions or misstatements, among others. NFT transactions may also be subject to laws governing
virtual currency or money transmission. For example, New York has legislation regarding the operation of virtual currency businesses.
NFT transactions also raise issues regarding compliance with laws of foreign jurisdictions, many of which present complex compliance
issues and may conflict with one another. Our launch and operation of our NFT platform expose us to the foregoing risks, among others,
any of which could materially and adversely affect the success of our NFT platform and harm our business, financial condition, results
of operations, reputation, and prospects.
 
Our
management team relies on outside consultants and others in our industry to make informed business decisions; potential conflicts of
interest involving those parties who are relied upon could adversely affect the execution of our business model
 
Our
management team has relied and will continue to rely on consultants and service providers in our industry. Many of these consultants
or service providers represent or provide services to others in this industry, and no assurance can be given that we, as a small competitor
competing with larger competitors in our industry, will be able to engage these consultants. In addition, our inability to retain such
consultants would negatively affect our ability to identify and evaluate life insurance products for purchase. Even as our management
accumulates expertise in this industry, we will still rely on the expertise of outside consultants for a variety of information, including
valuation, life expectancies, actuarials and other matters specific to life insurance policies. If we cannot obtain such services at
an affordable price, our business will be harmed.
 

11
 

 
Current
and future federal regulation under the Dodd-Frank Act’s consumer protection provisions may have an adverse effect on our business
and our planned business operations.
 
On
July 21, 2010, President Barack Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank
Act”). The Dodd-Frank Act contains significant changes to the regulation of financial institutions including the creation of new
federal regulatory agencies and the granting of additional authorities and responsibilities to existing regulatory agencies to identify
and address emerging systemic risks posed by the activities of financial services firms. The Dodd-Frank Act also provides for enhanced
regulation of derivatives and asset-backed securities offerings, restrictions on executive compensation and enhanced oversight of credit
rating agencies. The provisions include a new independent Bureau of Consumer Financial Protection to regulate consumer financial services
and products, and life settlement transactions may be within the scope of its jurisdiction. Actions taken by the Bureau of Consumer Financial
Protection may have material adverse effects on the life settlement industry and could affect the value of insurance policies. In addition,
the Dodd-Frank Act also limits the ability of federal laws to preempt state and local consumer laws. Prospective investors should be
aware that the changes in the regulatory and business landscape as a result of the Dodd-Frank Act could have an adverse impact on us
and the entities from which we may acquire NIBs and similar life settlement products.
 
General
economic conditions could have an adverse effect on our business.
 
Changes
in general economic conditions, including, for example, interest rates, investor sentiment, market and regulatory changes specifically
affecting the insurance industry, competition, technological developments, political and diplomatic events, tax laws, and other factors
not known to us today, can substantially and adversely affect our business and prospects. There continues to be uncertainty about the
prospects for growth in the U.S. economy as well as economies of other countries, driven by factors such as high current unemployment,
rising government debt levels, prospective Federal Reserve (and similar foreign bodies) policy shifts, the withdrawal of government interventions
in financial markets, changing consumer spending patterns, and changing expectations for inflation and deflation. These factors have
adversely affected the financial markets and the claims-paying ability of many insurers. Such uncertainties and general economic trends
can affect the ability to obtain funds to finance life settlement products. None of these risks are or will be within our control.
 
The
costs in time and expense of being a publicly-held company are substantial and will only increase if our business model is successful.
 
We
are required to file annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports respecting certain events on Form
8-K, along with proxy or information statements for any meeting of stockholders or written consents of stockholders holding sufficient
securities to effect corporate actions. Most of these reports require generating and compiling significant accounting, legal and financial
information, including audited year-end financial statements and reviewed quarterly financial statements. The preparation of these reports,
their review by management and professionals and the auditing and review process of such financial statements consumes significant resources,
in terms of management time and focus, as well as expenses related to legal, accounting and audit fees. It is difficult to quantify these
costs, but we believe them to be not less than between approximately $175,000 and $250,000 annually. As our business grows, these costs
can only increase.
 
We
are new to the bond, life settlement, and financial advisory industry and may not be able to successfully compete in this industry.
 
We
only recently began providing advisory services relating to bond issuances and life settlement transactions. In order for these operations
to be successful, we will need to develop sufficient expertise and establish relationships with clients. Identifying and acquiring clients
in this industry will require us to compete with other larger, more experienced, and better capitalized service providers and we may
not be successful in developing such client relationships. If we are not able to successful market our advisory business, our financial
condition and results of operations will be materially adversely affected.
 

12
 

 
Historically,
99% of our total assets are interests in life settlement policies, resulting in a lack of diversification of assets and concentration
in assets that are subject to significant fluctuations in value.
 
Although
we currently have no ownership in life settlement policies, generally speaking, our previous investment in NIBs was usually the primary
asset on our balance sheet. Life settlement products like NIBs are subject to substantial fluctuations in value, primarily based upon
matters that are not within our control, such as the current health and life expectancy of the insureds underlying our NIBs, the solvency
of the Holders of the policies and the Holders’ Lender, the Holders’ financing costs and ability to acquire policies and
the solvency of the insurance companies. Each of these factors can result in significant fluctuations of the value of the life insurance
policies underlying the NIBs, thereby affecting potential future interests.
 
Limitations
to the financial model we use may result in inaccurate or incomplete projections of future cash flow from the insurance policies.
 
The
financial model we utilized to project future cash flows from potential life settlement assets was chosen because of its straight-forward
approach in calculating expected cash flows. We believe the methodology used in the model is particularly desirable because it has parameters
that are easily verifiable and does not require complex calculations or mathematical simulations to confirm results. However, with every
financial model, there are limitations. Most require assumptions to be made. Our model is no exception. Our assumptions may prove to
be incorrect and, therefore, our model may be incorrect. Our model relies on actuarial life-expectancy reports prepared by third parties
from which the estimated date of maturity is calculated. It is assumed that these reports were accurately made and properly reflect real
life expectancies. Our model also requires other inputs including but not limited to the following: (i) a 15-year period for projections;
(ii) a distinct number of lives; (iii) a distinct number of policies; (iv) life expectancy tables and projections; (v) premiums; (vi)
senior lending fees; (vii) MRI fees; and (viii) insurance, servicing and custodial fees. While this method of modeling cash flows is
helpful in setting general expectations of potential returns that might be produced from a given portfolio, there is no way such results
can be guaranteed. In addition to our assumptions, there are many factors that may affect the selection of inputs for the model.
 
The
individuals insured by the life insurance policies may live longer than their actuarial life expectancies and thereby, cash flows from
life insurance policies may be delayed.
 
The
actual date of death of an insured with respect to a life insurance policy is uncertain. Life expectancies are projected from the medical
records of the insured and actuarial data based upon the historical experience of similarly situated persons. However, it is impossible
to predict with certainty any insured’s life expectancy. We have and will continue to base our longevity assumptions on the reports
of third-party life expectancy providers, among whom there is no uniformity of assumptions, approach or procedure. There are also significant
disputes among third-party life expectancy providers regarding the mortality rate relating to certain disease states and the efficacy
of certain treatments. Some factors that may affect the accuracy of a life expectancy report or other calculation of the estimated length
of an individual’s life are:
 


 
●
the
    experience and qualifications of the medical professional or life expectancy company providing the life expectancy estimate;

 
 
 

 
●
the
    completeness and accuracy of medical records received by the life expectancy company;

 
 
 

 
●
the
    reliability of, and revisions to, actuarial tables or other mortality data published by public and private organizations or developed
    by a life expectancy company and utilized by its medical professionals;

 
 
 

 
●
the
    nature of any illness or health conditions of the insured disclosed or undisclosed;

 
 
 

 
●
changes
    in living habits and lifestyle of an insured and medical treatments, medications and therapies available to and used by an insured;
    and

 
 
 

 
●
future
    improvements in medical treatments and cures, and the quality of medical care the insured receives.

 

13
 

 
We
rely primarily on various different life expectancy providers. A life expectancy (“LE”), can be considered the life expectancy
provider’s “best estimate” as to how long a person would live. We assume that the life expectancies were accurately
calculated and properly assessed for purposes of our model. To introduce some “checks and balances” into our cash flow projections,
we use at least two LE reports from different third-party LE providers for each policy. We do this to try to avoid any systemic bias
introduced by dependency on life expectancies produced by a single source. In addition, our model gives greater weight to the longer
(and more conservative) of the two LEs. By using such a long/short weighted average, our model attempts to hedge against unexpected longevities
in a portfolio.
 
Changes
in actuarial based life expectancy methodologies (which are determined by the Society of Actuaries and are amended every three to five
years) could have the effect of reducing the internal rate of return on the life insurance policies and could cause increased difficulty
in financing premiums. If changes are significant, they could lower prices for life insurance policies, but could also lower the value
of the life insurance policies due to the lower resulting present value of the death benefits forecasted to be paid at later dates. Holders’
senior loans require that certain loan to value ratios be maintained and decreases in policy values could result in violations of these
provisions. Default by Holders on their senior loans may impair their ability to obtain financing necessary to maintain the life insurance
policies.
 
In
addition, because our cash flow is usually dependent on life insurance policies coming to maturity, if life expectancies prove wrong
cash flows will change. If the insured lives longer than any or all of the life expectancy appraisals predict, then the amounts available
to life settlement interests could be diminished, perhaps significantly, due to the additional time during which premiums will have to
be paid and financing and other related expenses incurred in order to keep the related policy in force. If the insureds with respect
to too many life insurance policies live longer than their respective life expectancies, then Holders may have to liquidate such life
insurance policies. The market value of such Policies will necessarily be significantly less than the related death benefits.
 
Having
relatively few insureds could cause the overall performance to be unduly influenced by a relatively small number of underlying policies
that perform better or worse than expected.
 
Our
life expectancy actuarial results related to smaller portfolios may not be as reliable as they would be if the underlying portfolios
were larger. We understand that Standard & Poors has stated that at least 1,000 lives are required to achieve actuarial stability,
while A.M. Best concluded that at least 300 lives are necessary. Having fewer lives in a policy portfolio can cause the overall performance
of such portfolio to be unduly influenced by a relatively small number of “outliers” where the assets perform better or worse
than expected. The industry has sought to mitigate this risk by obtaining MRI coverage, which has the effect of accelerating cash flows
in cases where the assets underperform and reducing the volatility normally associated with a portfolio with fewer lives.
 
Increased
general market interests rates could increase the carrying costs of the life insurance policies and reduce the related cash flows.
 
If
general market interest rates increase, the value of life insurance portfolios would likely decrease. Some of the Holder’s carrying
costs associated with the life insurance policy portfolios (specifically interest payments on the MRI coverage outstanding balance) are
tied to interest rates. If interest rates increase, the Holder’s carrying costs will increase and the return on our investment
will decrease. Because the Holders pay all of the costs associated with the life insurance policy portfolios, an increase in the Holder’s
carrying costs will correspondingly decrease the amount of cash flows.
 
In
addition, if the interest rates used to determine the market value of a life insurance policy change, the present value of the policy
may also change. Generally, as interest rates increase, the present value of a life insurance policy decreases. If a Holder is forced
to sell a policy in a higher interest rate environment, the market price for the policies may be less than the price at which such policy
was acquired. Furthermore, Holders are generally obligated under the senior loans financing the purchase of life insurance policies to
maintain certain loan to value ratios. If the present value of the life insurance policies decreases significantly, the Holder may be
in breach of such obligations, which could impair the Holder’s ability to obtain financing necessary to service existing life insurance
policies or acquire new policies. As a result, any life insurance portfolios may decline in value or become worthless.
 

14
 

 
Changes
to foreign banking laws and regulations or decreased lending capacity for life settlements could have a negative impact on the ability
of Holders to obtain loans with respect to purchases of life settlements.
 
Our
current business model relies on the availability to the Holders of senior loans from the Holders’ Lender or any other lender.
In the event of adverse regulatory changes or reduced capacity for life settlement lending, the Holders could experience the same liquidity
issues that have plagued other market participants. Changes to the Holders’ Lender’s loan to value requirements, compliance
with regulatory large exposure limits and changes to regulatory large exposure limits could also result in liquidity issues for the Holders
and corresponding liquidity issues for us. As mentioned above, changes in life expectancies could cause decreases in policy values, which
could result in loan to value violations and violations of large exposure limits.
 
Holders
may be required to obtain MRI coverage as a condition of our business model, which, if unavailable, could potentially increase our risk
of failure.
 
The
MRI is a relatively new product and there are no guarantees that the MRI provider will be able to meet the Holders’ coverage needs.
In addition, it is our understanding that there is only one MRI provider. The MRI provider has refused to provide future coverage to
the Holders. Without the MRI coverage, the Holders have limited options when the senior loans mature. The Holders’ Lender has demanded
repayment of all outstanding amounts under the senior loans.
 
The
lapse of life insurance policies will result in the entire loss of our interest in the death benefits from those particular policies.
 
The
Holders are required to make premium payments on the life insurance policies in order to keep such policies in force. These payments
generally will be made from amounts available to the Holders pursuant to the senior loans, death benefits, and MRI payments, if available.
 
Actual
results from life settlement products may not match expected results, which could reduce returns and also adversely affect the ability
to service and grow a portfolio for actuarial stability.
 
Our
business model relies on achieving actual results similar to those projected by using actuarial estimates. We believe that the larger
the portfolio of policies, the more reliable actuarial estimates will be and, likewise, the greater the likelihood that expected results
will be achieved.
 
In
a study published in 2012, A.M. Best concluded that at least 300 lives are necessary to narrow the band of cash flow volatility and achieve
actuarial stability, while Standard & Poor’s has indicated that actuarial stability is unlikely to be achieved with a pool
of less than 1,000 lives. While there is a risk with a portfolio of any size that actual yield may be less than expected, we believe
that the risk we face is presently more significant given the relatively low number of insureds underlying our potential NIBs as compared
to rating agency recommendations. Even if our portfolio reaches a size that is actuarially stable according to the rating agencies, we
still may experience differences between the actuarial models we use and actual mortalities. Differences between our expectations and
actuarial models, and actual mortality results, could have a materially adverse effect on our operating results and cash flow. In such
a case, we would face liquidity problems, including difficulties acquiring new NIBs and other life settlement products. Continued or
material failures to meet our expected results could decrease the attractiveness of our securities in the eyes of potential investors,
thereby making it even more difficult to obtain capital needed to acquire additional NIBs and obtain desired diversification and expansion
of the underlying insureds.
 
The
limited number of sellers of life settlement products in the secondary market may limit the ability to negotiate favorable prices in
the acquisition of such life settlement interests.
 
Because
we are not currently licensed to purchase life insurance policies directly from the insureds, we rely on re-sellers like Del Mar, PCH
and HFII for such products.
 
Unless
other sources become available, the ability to purchase the life settlement products desired may be limited. In addition, the limited
number of sellers could limit the ability to negotiate favorable prices to purchase life settlement products, which could reduce profitability.
Furthermore, recent declines in the secondary market for life settlements have limited the availability of pools of life insurance policies,
resulting in increased price competition.
 

15
 

 
We
do not track concentrations of pre-existing medical conditions of insureds in our guidelines for purchasing life settlement products.
 
Concentrations
of pre-existing medical conditions in insureds could affect the valuation of the portfolios that such policies underlie. We do not track
concentrations of pre-existing medical conditions in purchases of life settlement products. Thus, the valuation of such interests and
our estimates of cash flows therefrom could be inaccurate.
 
If
life settlement products are determined to be “securities,” Holders may be required to register as an investment company
under the Investment Company Act, which would substantially increase SEC reporting costs and oversight of a Holder’s business operations.
 
On
July 22, 2010, the SEC released a Staff Report by the Life Settlements Task Force that recommended the SEC consider recommending to Congress
that it amend the definition of “security” under the federal securities laws to include life settlement policies as securities.
One U.S. Congressman has sought to introduce a bill to make such amendment. While that attempt did not result in any action, there can
be no assurance that such a bill will not be passed at some future date. If federal securities laws are indeed amended to include such
policies within the definition of “security,” or if courts with relevant jurisdiction interpret existing securities laws
to that effect, our ability to operate our business under our current business model may be constrained by additional regulatory requirements
under the Securities Act, the Exchange Act and the Investment Company Act.
 
Such
requirements could, among other things, limit our or Holder’s ability to change investment policies without stockholder approval,
prohibit our acquisition of assets from an affiliate without SEC approval, limit leveraging of our assets to one-third of our total asset
value, require accounting for all derivatives as a leverage of assets to the extent that they create an obligation on our part to pay
out assets to a counterparty ahead of our stockholders and generally require 40% of our directors to be independent directors. In addition,
intermediaries used to purchase life settlement products may be required to register as broker-dealers or registered investment advisers
and would otherwise be subject to oversight by the SEC and the Financial Industry Regulatory Authority, which require adherence to numerous
rules and regulations. Such regulations could substantially increase our compliance and reporting costs, which would negatively affect
profitability.
 
There
is poor liquidity in the secondary market for life insurance and life settlements.
 
The
secondary market for life insurance policies and life settlements is relatively illiquid, and it is often difficult to sell life insurance
policies or interests in life insurance policies at attractive prices, if at all. The ability to sell life insurance policies may be
made even more difficult due to the nature in which the policies were originated, especially with respect to policies where the premiums
were financed by the original owner, creating an increased risk associated with holding such policies. Holders may be limited in their
ability to liquidate assets if they need to do so in order to raise funds to pay premiums, or otherwise.
 
Life
settlements, and therefore our common stock, are highly speculative and may lose all of their value.
 
Life
settlements are highly speculative investments. With respect to life insurance policies, it is not possible to determine in advance either
the exact time that a life insurance policy will reach maturity (i.e., at the death of the insured) or the profit, loss or return on
an investment in a life insurance policy. The longer the period between the purchase of a life settlement and the payout on the underlying
policy at maturity, the lower return will be because of the cost to maintain the underlying policies.
 
In
addition, no assurance can be given that any life insurance policy will perform in accordance with projections, and any such life insurance
policy may decline in value. Consequently, there can be no assurance that, to the extent we invest in NIBs, we will realize a positive
return on our investment. These types of investments should be considered to be highly speculative in nature. This, in turn, may directly
affect the amount and timing of funding sought or received by us, which in turn will affect our ability to conduct our business. Thus,
an investment in our Company is suitable only for investors having substantial financial resources, a clear understanding of the risk
factors associated with such investments and the ability to withstand the potential loss of their entire investment.
 

16
 

 
Risks
Related to the Life Insurance Policies
 
Policies
may be determined to have been issued without an “insurable interest” and could be void or voidable.
 
State
insurance laws in the United States require that an insurance policy may only be initially procured by a person that has an insurable
interest in the continuance of the life of the insured. Whether an owner has an insurable interest in the insured is a question of applicable
state law. The general concept is that a person with an insurable interest is a person that has a continuing interest in the insured
remaining alive, whether through the bonds of love and affection or due to certain recognized economic relationships. Typically this
includes the insured, the insured’s spouse and children, and in some states, other close relatives. In some jurisdictions, however,
this could also include entities such as the insured’s creditors, employer, business partners or certain charitable institutions.
It also typically includes a trust that owns a life insurance policy insuring the life of the grantor or settlor of the trust where the
beneficiaries of the trust are persons, who, by virtue of certain familial relationships with the grantor or settlor, also have an insurable
interest in the life of the insured.
 
A
policy purchased by a person without an insurable interest may, depending on relevant state insurance law, be (i) void, (ii) voidable
by the insurer that issued the policy and/or (iii) subject to the claims of the insured’s presumptive beneficiaries, such as his
or her spouse or other family members. In some states, the insured must consent to the purchase of a policy by a person other than the
insured.
 
Generally,
state insurance law is clear that an individual has an insurable interest in his or her own life and may procure life insurance on his
or her own life and may name any person as beneficiary. However, if a person purchases insurance on his or her own life for the benefit
of a party who does not have an insurable interest in the life of the insured for the purpose of evading the insurable interest laws,
the purchase may be viewed under applicable state law as a violation of the state’s insurable interest laws. Should the issuer
own an interest in a policy that was originally issued to an owner or for the benefit of a beneficiary (if required) that did not have
an insurable interest, it is possible that the issuer may not have a valid claim for the death benefits on such policy, and upon the
death of the insured, the issuing insurance company may refuse to pay the death benefits on the policy to us or may be required to pay
the death benefit to other beneficiaries of the insured. Should any such claims be successful in relation to the policies underlying
NIBs, we could lose some or all the amounts we have invested in NIBs, although in some states the issuing insurance company may be required
to repay the premiums if it rescinds the policy. Some states, such as New Jersey, allow the carrier to retain all the premiums in the
event the policy is rescinded, and some states, such as Delaware, require premiums to be returned in cases where the policy is successfully
challenged by the carrier. Even if such claims are unsuccessful, significant amounts may need to be expended in defending such claims,
thereby reducing the amounts we may receive from NIBs and other life settlement interests we may purchase.
 
Concern
also exists regarding the applicability of state insurable interest requirements applicable to the purchase of a policy by an insured
or a person with an insurable interest in the life of the insured in circumstances in which the owner of the policy obtains a loan secured
by the policy to finance the payment of premiums on the policy, often referred to as a premium finance transaction. A substantial number
of the life insurance policies underlying NIBs have been originated pursuant to premium finance transactions. While it is generally accepted
by state law that an individual has an insurable interest in his or her own life, it is possible that a court might construe a premium
finance transaction as an attempt to evade the requirement that an insurable interest exist at the time an insurance policy is issued.
If the borrower in such a transaction is found to be acting, in fact, on behalf of a premium finance company to procure an insurance
policy, it is possible that a court might find that the real party in interest is the premium finance company, which by itself would
not have an insurable interest sufficient to support the insurance policy. As a result, the insurance policy may be void or subject to
attack, which could diminish the value of the policy. States have varying precedent on this subject. California, New York and Florida
have case law that is very favorable to the policy owner (see Lincoln v. Jack Teren and Jonathan S. Berck, as trustee of the
Jack Teren Insurance Trust (Superior Court of the State of California, San Diego), Alice Kramer v. Lockwood Pension Services,
Inc., et al., (United States District Court – Southern District of New York)). These courts have held life insurance policies
to be enforceable even where the policies were clearly purchased with an intent to sell the policies in the future. Florida has case
law that is also favorable (see PrucoLife Insurance Company v. Wells Fargo (Florida Supreme Court, which held that a policy
may not be contested after the expiration of the policy’s contestability period). Delaware has laws which benefit the insurance
carrier and others that are more favorable to the policy owner (see PHL Variable Insurance Co. vs. Price Dawe, (Supreme
Court of Delaware) and Principal Life Insurance Company v. Lawrence Rucker 2007 Insurance Trust (District Court of Delaware)).
These courts have invalidated policies where the original policy owners financed the policies and did not intend to purchase the policies
with their own money and further intended to ultimately sell the policies in the life settlement markets. However, the Rucker case did
provide that premium financing could qualify as an insured procuring a policy and satisfy requirements related to insurable interest.
There is also legislation in most states regulating premium financing that must be complied with for policies originated after the legislation
was enacted.
 

17
 

 
Also,
in every state that has addressed the question other than New York and Michigan, the expiration of an insurance policy’s contestability
period may not cut off the insurer’s ability to raise the insurable interest issue as a defense to the payment of the policy proceeds.
 
One
or more states could adopt legislation that would require a holder of an insurance policy to have an insurable interest in the insured
at the time a policy is purchased and at the time of death of the insured. Neither us nor the Holders will have an insurable interest
in the insureds polices acquired by or on our behalf. If such legislation were to be adopted without a ‘grandfathering’ provision
(i.e., so as not to be applicable to insurance policies then in force), then we may be unable to collect the proceeds on the death benefits
of the insured persons under our NIBs purchased prior to the enactment of such legislation and our NIBs would be worthless.
 
Additional
insurable interest concerns regarding life insurance policies originated pursuant to premium finance transactions may also result in
adverse decisions that could effect policies.
 
The
legality and merit of “investor-initiated” or “stranger-originated” life insurance products have been questioned
by members of the insurance industry, including by many life insurance companies and insurance regulators. For example, the New York
Department of Insurance issued a General Counsel’s opinion in 2005 concluding that a premium finance program that was coupled with
the right of the policy owner to put the financed insurance policy to a third party violated New York’s insurable interest statute
and may also constitute a violation of New York State’s prohibition against premium rebates/free insurance. More recently, many
states have enacted laws expressly defining and prohibiting stranger-originated life insurance (“STOLI”) practices, which
in general involve the issuance of life insurance policies as part of or in connection with a practice or plan to initiate life insurance
policies for the benefit of a third-party investor who, at the time of the policy issuance, lacks a valid insurable interest in the life
of the insured. Under these laws, certain premium finance loan structures are treated as life settlements and, accordingly, may not be
entered into at the time of policy issuance and for a two or five year period thereafter, depending on the state. Certain court decisions
issued over the past few years may also increase concerns with premium financed policies. In 2011, the Delaware Supreme Court stated
in PHL Variable Insurance Company v. Price Dawe 2006 Insurance Trust that the key focus in insurable interest cases is who paid
the premiums. While the decision was not issued in connection with a premium financed policy, investors were concerned with how the court
would apply such reasoning to premium financed policies. This concern was alleviated in the 2012 Delaware District Court case of Principal
Life Insurance Company v. Lawrence Rucker 2007 Insurance Trust that concluded that “an insured’s ability to procure a
policy is not limited to paying the premiums with his own funds; borrowing money with an obligation to repay would also qualify as an
insured procuring a policy.”
 
We
cannot predict whether a state regulator, insurance carrier or other party will assert that any policies should be treated as having
been issued as part of a STOLI transaction or otherwise were issued in contravention of applicable insurable interest laws. This risk
is greater where the insured materially misstated his or her income and/or net worth in the life insurance application. Decisions in
Florida have increased the risk that challenges to premium financed policies may be decided in favor of the issuing insurance company.
Moreover, because the life insurance policies are often originated in the same or a similar manner and in a limited number of states
(generally, California and Wisconsin, although the insured may reside in other states), there is a heightened risk that an adverse court
decision or other challenge or determination by a regulatory or other interested party with respect to a policy could have a material
adverse effect on a significant number of other policies, including the rescission of policies or the occurrence of other actions that
prevent us from being entitled to receive or retain the net death benefit related to the policies. Concerns of such nature could also
negatively affect the market value and/or liquidity of the life insurance policies.
 

18
 

 
Fraud
in the application for life insurance can also affect assets and interest in policies.
 
There
are risks that policies may be procured on the basis of fraud or misrepresentation in connection with the application for the policy.
Types of fraud that have enabled carriers to successfully rescind or void the related policies include, among others, misrepresentations
concerning an insured’s financial net worth and/or income, need for and purpose of the life insurance protection, medical history
and current physical condition, including age and whether the insured is a smoker. Such risk of fraud and misrepresentation is heightened
in connection with life insurance policies for which the premiums are financed through premium finance loans or other structured programs.
In particular, there is a significant risk that applicants and potential insureds may not answer truthfully or completely questions related
to whether the life insurance policy premiums will be financed through a premium finance loan or otherwise, the applicants’ purpose
for purchasing the policy or the applicants’ intention regarding the future sale or transfer of the life insurance policy. Such
risk may be further increased to the extent life insurance agents communicate to applicants and potential insureds regarding potential
premium finance arrangements or profits to be made on policies that will be sold after the contestability period. If an insured has made
any material misrepresentation on his/her application for life insurance, there is a heightened risk that the insurance company will
contest or successfully rescind or void the related policy, although an issuing insurance company may not be able to raise such claims
after the expiration of the contestability period. There has been significant litigation regarding whether or not a policy can be contested
for fraud after the expiration of the contestability period. Florida, California and New York have concluded that a carrier may not contest
a policy after the contestability period. New Jersey and Delaware have allowed such contests by the carriers. Even if such fraud in the
application could not serve as a basis to challenge a policy because the contestability period has expired, it may be raised as evidence
that the policy was provided as part of a STOLI arrangement. Furthermore, such misrepresentations can adversely affect the actuarial
value of the death benefit under the related life insurance policies.
 
The
risk of litigation with issuing insurance companies could substantially raise our costs of operation and increase our risk of loss.
 
Some
of the programs relating to the premium finance transactions through which certain underlying insurance policies are originated, or other
programs having similar characteristics, may be objectionable to certain life insurance companies and other parties, including certain
regulators, on the basis of constituting a means of originating stranger-originated life insurance. Additionally, as described above,
life insurance policies that are originated through the use of premium finance programs often present a greater risk of there having
been fraud and/or misrepresentations in connection with the issuance of the policies. For these reasons, among others, it is possible
that holders may become subject to, or may otherwise become affected by, litigation involving one or more issuing insurance companies
(either as a plaintiff or a defendant), including claims by an issuing insurance company seeking to rescind a policy prior to or after
the death of the related insured. Moreover, such risk may be enhanced with respect to an issuing insurance company that is experiencing
financial difficulty, since a successful claim by an issuing insurance company could reduce its financial liabilities. In the event any
litigation involving the policy holder was to occur, the policy holder would bear the costs of such litigation, and would be unable to
predict its outcome, which could include losing the right to receive (or retain) the proceeds otherwise payable under one or more of
the underlying policies.
 
The
contestation of the life insurance policies by the applicable issuing insurance companies could result in the loss of the benefits from
such life insurance policies.
 
The
ability of an issuing insurance company to seek to rescind one or more life insurance policies depends on whether such issuing insurance
company is barred from bringing a rescission action by operation of an incontestability clause contained in the life insurance policies
or contestability limitations applicable as a matter of state law. Each life insurance policy, in accordance with laws adopted in virtually
every state in the United States, contains a provision that provides that, absent a failure to pay premiums, a policy shall be incontestable
after it has been in force during the lifetime of the insured for a period of not more than two years after its date of issue. However,
as stated above, some states recognize an exception to incontestability where there was actual fraud in the procurement of the policy.
A new contestability period may also arise in connection with information provided on any application for reinstatement of a life insurance
policy following lapse of a policy due to non-payment of premiums, or an application for an increase in policy benefits. The successful
contestation of the life insurance policies by the applicable issuing insurance companies could materially and adversely affect cash
flows.
 

19
 

 
Increases
in cost of insurance could reduce estimated returns and lower revenues.
 
Insurers
pass on a portion of their expenses to operate their business and administer their life insurance policies in the form of policy charges
borne by each policyholder. In the event an insurer experiences significantly higher than anticipated expenses associated with operation
and/or policy administration, the insurer has the right to increase the charges to each of its policy owners. In the event the charges
to a life insurance policy are materially increased, additional premium payments may be required to maintain enforceability of such policy.
 
AXA
Equitable issued cost-of-insurance, referred to herein as “COI,” increases on eleven (11) of the previously held life insurance
policies underlying our prior NIBs. In addition, one Transamerica and one Lincoln policy, both of which were Policies underlying our
prior NIBs, were subject to increased COI’s. Other carriers have been issuing COI increases that impact life insurance policies
held by large settlement funds. Multiple lawsuits, including class actions, against Phoenix Life, Lincoln National Insurance Company,
AXA Equitable, Banner Life, and Transamerica Life Insurance Company are currently ongoing. However, most of these lawsuits are in the
very early stages.
 
Carrier
and service partner credit risk can adversely affect life settlements.
 
Holders
are subject to the credit risk associated with the viability of the various insurance companies that issued the life insurance policies.
The insolvency of an issuing insurance company or a downgrade in the ratings of an issuing insurance company could have a material adverse
impact on the value of a policy issued by such issuing insurance company, as the collectability of the related death benefits and the
ability of such issuing insurance company to pay the cash surrender value or other amounts agreed to be paid by the issuing insurance
company may be reduced. Any such impairment of the claims-paying ability of the issuing insurance company could materially and adversely
affect the value of the policies issued by such insurance company, the ability of the Holder to pay the premiums due on other insurance
policies and the Holders ability to pay any required policy premiums, fees and expenses of the service providers and our other expenses,
which could materially and adversely affect the value of a policy.
 
The
inability to keep track of the insureds could keep us from updating the medical records of the insured.
 
It
is important for the Holder of the life insurance policies to track the health status of an insured and keep information current, which
is done by contacting the insured and/or other designated persons and obtaining updated medical records from an insured’s physician.
There are significant U.S. federal and state laws relating to privacy of personal information that affect the operations of the servicer
and its ability to properly service the policies, especially with regard to obtaining current information from an insured’s physician.
 
Under
the Health Insurance Portability and Accountability Act or HIPAA, the federal law that governs the release of medical records from medical
record custodians, an insured may revoke his or her authorization for previously authorized third parties to receive medical records
at any time, leaving the Holder unable to receive additional medical records.
 
The
Holder may have to rely on a third party servicer to track an insured, especially if states continue to adopt laws that would limit the
ability of person other than a licensed life settlement provider or its authorized representative to contact insureds for tracking purposes,
and the servicer may lose contact with such insured. For example, the insured may move and not notify the servicer or any other third
party that has authority to contact the insured. The servicer attempts to maintain contact information for the insured and/or one or
more close family friends or relatives whenever possible so it can maintain contact with the insured. Additionally, the servicer subscribes
to various databases that use public records and other information to track individuals. The servicer also subscribes to death notification
services which use Social Security and public records information to notify the servicer if an insured has passed away so that it can
begin the process of obtaining a death certificate and arranging for the payout of the policy. Changes to the Social Security Administration’s
Death Master File have resulted in the elimination of many state records that were previously included in the Death Master File. The
number of new records being added to the Death Master File has been reduced by approximately 40%. Thus, it has become necessary to enhance
alternative methods for learning of an insured’s death. On average, it now takes longer to learn about an insured’s death
as compared to periods prior to the changes in the Death Master File.
 

20
 

 
Despite
these various tracking methods, it is still possible for the Holder to lose contact with an insured, making any additional updates of
medical condition for the insured impossible. There can also be no assurance that the Holder will learn of an insured’s death on
a timely basis. Delays in receiving insurance proceeds result in a decrease in the death benefit.
 
Lost
insureds can result in a delay or a loss of an insurance benefit that would have a negative effect on revenues and prospects.
 
Occasionally,
the issuing insurance company may encounter (or assert) situations where the body of the insured or reasonable other evidence of death
cannot be located and/or identified. For example, the insured may have been lost at sea and there may not be proof of death available
for several years or at all. Alternatively, the fact that the original beneficiaries no longer have any financial interest in a claim
under the policy may mean that the issuing insurance company faces practical obstructions to recording accurately and in a timely manner
the death of the insured. In the event of a “lost” insured, the death claim may be delayed for up to seven years by the issuing
insurance company. Under these circumstances, typically, the claim will then be paid with interest from the date that the insured was
originally presumed lost. Nonetheless, it remains possible that it will be difficult or impossible to locate and/or identify an insured
to establish proof of death and, as a result, the related issuing insurance company may significantly delay (but not ultimately avoid)
payment of the underlying death benefit. This delay could result in a longer than anticipated holding period for a policy which, in turn,
could result in a loss.
 
The
death of an insured must have occurred to permit the servicer to file a claim with the issuing insurance company for the death benefit.
Obtaining actual knowledge of death of an insured, as discussed above, may prove difficult and time-consuming due to the need to comply
with applicable law regarding the contacting of the insured’s family to ascertain the fact of death and to obtain a copy of the
death certificate or other necessary documents in order to file the claim. The death benefit typically increases subsequent to death
by an interest rate that is less than the interest rate under the senior loan; thus, the policy proceeds become less valuable as time
passes.
 
U.S.
life settlement and viatical regulations may result in determination(s) of applicable law violations.
 
The
purchase and sale of insurance policies in the secondary market from the policy’s original owner and among secondary market participants
is subject to regulation in approximately 45 states and Puerto Rico. The scope of the regulations and the consequences of their violation
vary from state to state. In addition, within a given state, the regulations may vary based upon the life expectancy of the insured at
the time of sale or purchase. In many states, a policy on an insured with a life expectancy of two years or less is referred to as a
“viatical settlement” or a “viatical.” A policy on an insured with a life expectancy of more than two years is
referred to as a “life settlement.” The Holders have not, and do not intend to, purchase viatical settlements and should
not be subject to the regulatory regimes that govern these policies. However, the states vary in their technical definitions of viatical
settlements and life settlements, and state insurance regulators, who are charged with interpretation and administration of insurance
laws and regulations, vary in their interpretations. Therefore, despite expectations, it may be possible that under the rules of a particular
state, a policy that is not commonly thought of as a viatical settlement may meet the technical definition thereof. Engaging in the purchase
or sale of life settlements or viatical settlements in violation of applicable regulatory regimes could result in fines, administrative
and civil sanctions and, in some instances, criminal sanctions. United States and state securities laws could have an adverse effect
on the Holders’ ability to liquidate any policies we or they believe should be sold.
 
It
is possible that, depending on the facts and circumstances attending a particular sale of a life insurance policy, a sale could implicate
state and federal securities laws. The failure to comply with applicable securities laws in connection with dealings in life settlement
transactions could result in fines, administrative and civil sanctions and, in some instances, criminal sanctions. In addition, parties
may be entitled to a remedy of rescission regarding such transactions. State guaranteed funds give some protection for payments under
life insurance policies, but no assurance can be given that we will benefit from them.
 

21
 

 
State
protections for the insolvency of an insurance company are limited.
 
With
respect to the life insurance policies, the payment of death benefits by issuing insurance companies is supported by state regulated
reserves held by the issuing insurance companies and, under certain circumstances and in limited amounts that vary from state to state,
state-supported life and health insurance guaranty associations or funds. However, such reserves and guaranty funds, to the extent in
existence, may be insufficient to pay all death benefits under the life insurance policies issued by an issuing insurance company if
such issuing insurance company becomes insolvent. Even if such guaranty funds are sufficient, the obligation of a state guaranty fund
to make payments may not be triggered in certain circumstances.
 
The
benefits of most or all of such state supported guaranty funds are capped per insured life (irrespective of the number of policies issued
and outstanding on the life of such individual), which caps are generally less than the net death benefits of the insurance policies.
Guaranty fund laws often include aggregate limits payable with respect to any one life across different types of insurance policies,
generally $300,000 to $500,000 depending on the state. Most state guaranty funds are statutorily created and the legislatures may amend
or repeal the laws that govern them. In addition, most state guaranty fund laws were enacted with the stated goal of assisting policy
holders resident in such states. Therefore, non-resident policyholders, beneficiaries, and claimants may not be covered or may be covered
only in limited circumstances. As a result, state guaranty funds will likely provide little protection to us in the event of the insolvency
of an issuing insurance company. In addition, in the event of an issuing insurance company’s insolvency, courts and receivers may
impose moratoriums or delays on payments of cash surrender values and/or death benefits.
 
Liability
for failing to comply with U.S. privacy safeguards.
 
Both
federal and state statutes safeguard an insured’s private health information. In addition, insureds frequently have an expectation
of confidentiality even if they are not legally entitled to it. If any of the entities providing services related to the life insurance
policies properly obtains and uses otherwise private health information, but fails to maintain the confidentiality of such information,
such service provider may receive complaints from the affected individuals, their families and relatives and, potentially, interested
regulatory authorities. Because of the uncertainty of applicable law, it is not possible to predict the outcome of such disputes.
 
Additionally,
it is possible that, due to a misunderstanding regarding the scope of consents that a service provider possesses, such service provider
may request and receive from health care providers information that it in fact did not have a right to request or receive. Once again,
if a service provider receives complaints for these acts, it is not possible to predict what the results will be. This uncertainty also
increases the likelihood that a service provider may sell, or cause to be sold, life insurance policies in violation of applicable law,
which could potentially result in additional costs related to defending claims or enduring regulatory inquiries, rescinding such transactions,
possible legal damages and penalties and probable reduced market value of the affected life insurance policies. Each of the foregoing
factors may delay or reduce the return on life insurance policies.
 
Cyber-attacks
or other security breaches could have a material adverse effect on our business.
 
In
the normal course of business, we may have access to sensitive and confidential information regarding insureds. Although we devote significant
resources and management focus to ensuring the integrity of our systems through information security and business continuity programs,
our facilities and systems, and those of third party service providers, are vulnerable to external or internal security breaches, acts
of vandalism, computer viruses, misplaced or lost data, programming or human errors or other similar events.
 
Information
security risks have increased recently in part because of new technologies, the use of the Internet and telecommunications technologies
(including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized
crime, perpetrators of fraud, hackers, terrorists and others. In addition to cyber-attacks or other security breaches involving the theft
of sensitive and confidential information, hackers recently have engaged in attacks designed to disrupt key business services, such as
customer-facing websites. We are not able to anticipate or implement effective preventive measures against all security breaches of these
types, especially because the techniques used change frequently and because attacks can originate from a wide variety of sources. We
employ detection and response mechanisms designed to contain and mitigate security incidents, but early detection may be thwarted by
sophisticated attacks and malware designed to avoid detection.
 

22
 

 
The
access by unauthorized persons to, or the improper disclosure by us of, confidential information regarding the insureds could result
in significant legal and financial exposure, supervisory liability, damage to our reputation or a loss of confidence in our business,
which could have a material adverse effect on our business, financial condition or results of operations.
 
U.S.
privacy concerns may affect the access to accurate and current medical information regarding the insured under life insurance policies.
 
The
value of a life insurance policy is inherently tied to the remaining life expectancy of the insured and information necessary to perform
this valuation may not be available at the time of purchase or sale. For example, if a policy is being purchased in the secondary market
from an entity that had earlier purchased the policy directly from the insured, it is likely that the insured made his or her medical
records available at the time of his or her sale of the policy to the initial purchaser. However, if necessary consents were not obtained
from the insured, it is possible that this information cannot legally be made available at the time of the subsequent purchase of the
policy. If it is legally available to the subsequent purchaser, it is possible that such information is outdated and of little utility
for a current evaluation of the remaining life expectancy of the insured. Even if the insured granted a general consent that gave the
owner of the policy the right to subsequently request and receive medical information from the insured’s health providers, it is
possible for the insured to subsequently revoked such consent. Likewise, it is possible that, under applicable law, the consent expires
after a certain period of time. Even if the consent is effective, without the cooperation of the insured, it may be difficult to convince
the insured’s health care providers of the consent’s efficacy and such health providers may be reluctant to release medical
information. These impediments to accessing current medical information can prove to be a significant obstacle to the proper valuation
of a policy at the time of either the policy’s purchase or sale.
 
Risk
Factors Related To Our Common Stock
 
There
is a limited public market for our common stock, and any market that may develop could be volatile.
 
The
market for our common stock has been limited due to, among other factors, low public float of our common stock, low trading volume and
the small number of brokerage firms acting as market makers. There were 17,936,922 shares of our common stock held by non-affiliates
as of March 31, 2024. Thus, our common stock will be less liquid than the stock of companies with broader public ownership, and, as a
result, the trading price for shares of our common stock may be more volatile. Among other things, trading of a relatively small volume
of our common stock may have a greater impact on the trading price for our stock than would be the case if our public float were larger.
In addition, because our common stock is thinly traded, its market price may fluctuate significantly more than the stock market in general
or the stock prices of other companies listed on major stock exchanges. The average daily trading volume for our stock has varied significantly
from week to week and from month to month, and the trading volume often varies widely from day to day. Because of the limitations of
our market and volatility of the market price of our stock, investors may face difficulties in selling shares at attractive prices when
they want to.
 
An
active trading market for shares of our common stock may never develop or be sustained. If no trading market develops, securities analysts
may not initiate or maintain research coverage of our company, which could further depress the market for our common stock. As a result,
investors may not be able to sell their shares of our common stock at the time that they would like to sell. The limited market for our
shares may also impair our ability to raise capital by selling additional shares and our ability to acquire other companies or technologies
by using our common stock as consideration. The following may result in short-term or long-term negative pressure on the trading price
of our shares, among other factors:
 


 
●
Conditions
    and publicity regarding the life settlement market and related regulations generally;

 
●
Regulatory
    developments in the life settlement market;

 
●
Lack
    of listing for our common stock;

 
●
Lack
    of shares of our common stock in public float;

 

23
 

 


 
●
Lack
    of market makers with respect to our common stock;

 
●
Inability
    to raise needed capital; 

 
●
Low
    volume of trading of our common stock;

 
●
Price
    and volume fluctuations in the stock market at large, which do not relate to our operating performance; and

 
●
Comments
    by securities analysts or government officials, including those with regard to the viability or profitability of the life settlement
    industry generally or with regard to our ability to meet market expectations.

 
The
stock market has from time to time experienced extreme price and volume fluctuations that are unrelated to the operating performance
of particular companies.
 
We
are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies
will make our common stock less attractive to investors.
 
We
are an emerging growth company under the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. For as long as we continue to
be an emerging growth company, we intend to take advantage of certain exemptions from various reporting requirements that are applicable
to other public companies including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic
reports and proxy statements, exemptions from the requirements of holding a nonbinding advisory stockholder vote on executive compensation
and any golden parachute payments not previously approved, exemption from the requirement of auditor attestation in the assessment of
our internal control over financial reporting and exemption from any requirement that may be adopted by the Public Company Accounting
Oversight Board. If we do, the information that we provide stockholders may be different than what is available with respect to other
public companies. We cannot predict if investors will find our common stock less attractive because we will rely on these exemptions.
If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and
our stock price may be more volatile.
 
We
will remain an emerging growth company until the earliest of (1) the end of the fiscal year in which the market value of our common stock
that is held by non-affiliates exceeds $700 million as of the end of the second fiscal quarter, (2) the end of the fiscal year in which
we have total annual gross revenues of $1.235 billion or more during such fiscal year, (3) the date on which we issue more than $1 billion
in non-convertible debt in a three-year period or (4) the end of the fiscal year following the fifth anniversary of the date of the first
sale of our common stock pursuant to an effective registration statement filed under the Securities Act. Decreased disclosures in our
SEC filings due to our status as an “emerging growth company” may make it harder for investors to analyze our results of
operations and financial prospects.
 
Our
management and two stockholders beneficially own approximately 66% of our outstanding common stock and therefore can exert control over
our business.
 
Members
of our management team and three stockholders together beneficially own approximately 66% of our outstanding common stock. This percentage
of stock ownership is significant in that it could carry any vote on any matter requiring stockholder approval, including the subsequent
election of directors, who in turn appoint all officers. As a result, these persons control the Company, regardless of the vote of other
stockholders. As a result, other stockholders may not have an effective voice in our affairs.
 

24
 

 
Future
sales of our common stock could adversely affect our stock price and our ability to raise capital in the future, resulting in our inability
to raise required funding for our operations.
 
Sales
of substantial amounts of our common stock could harm the market price of our common stock. This also could harm our ability to raise
capital in the future. Of the 42,258,441 shares of our common stock that were outstanding as of March 31, 2024, 225,000 of such shares
are subject to leak-out agreements. Pursuant to such agreements, each of these stockholder’s common stock can only be sold in an
amount equal to 0.25% (1/4%) of our outstanding securities (to be defined for all purposes thereof as the amount indicated in our most
recent filing with the SEC) during each of the four quarterly periods beginning on January 1, 2017; 0.01 (1%) of our outstanding securities
during each of the next four successive quarterly periods, all on a non-cumulative basis, meaning that if no common stock was sold during
any quarterly period while common stock was qualified to be sold, such shares of common stock cannot be sold in the next successive quarterly
period (the “Leak-Out Period”). Notwithstanding the foregoing, any stockholder subject to a lock-up/leak-out agreement that
owns less than 100,000 shares of common stock that are covered thereby, is allowed to sell such stockholder’s common stock. Our
remaining outstanding shares are mostly freely tradable under Rule 144 and certain limitations on the number of shares that can be sold
quarterly by “affiliates” of the Company as defined under the Securities Act. Any sales of substantial amounts of our common
stock in the public market, or the perception that those sales might occur, could harm the market price of our common stock. See the
captions “Market Price of Common Stock and Related Matters” and “Security Ownership of Certain Beneficial Owners and
Management” of Part II, Item 5, below for further information. Further, certain stockholders have “piggy-back” registration
rights afforded to them if we file a registration statement with the SEC; these shares or any registered securities we may register can
also have an adverse effect on any market for our common stock.
 
We
will not solicit the approval of our stockholders for the issuance of authorized but unissued shares of our common stock unless this
approval is deemed advisable by our Board of Directors or is required by applicable law, regulation or any applicable stock exchange
listing requirements. The issuance of additional shares would dilute the value of our outstanding shares of common stock.
 
Item
1B. Unresolved Staff Comments
 
None.
 
Item
1C. Cybersecurity
 
Risk
Management and Strategy
 
Management
is to perform a corporate risk assessment annually, which includes specific consideration and assessment of cybersecurity risk, proportional
to the size of the Company. Service providers must meet certain security requirements such as security incident or data breach notification
and response protocols, data encryption requirements, and data disposal commitments.
 
In
managing cybersecurity risk, we employ a defense-in-depth strategy and regularly monitor our cyber environment for potential new threats.
Our strategy includes employee training and awareness on cybersecurity risks and related best practices, required password complexity,
the use of multi-factor authentication, information security protocols, anti-virus and anti-ransomware software.
 
Governance
 
Our
Board of Directors provides oversight of our cybersecurity program through an annual risk review. On an annual basis, cybersecurity risk
and mitigation strategies are reviewed as part of management’s reporting to the Board of Directors, which includes the reporting of significant
business risks, including cybersecurity mitigation strategies employed to manage these risks, and a review of any emerging risks. Annually,
management is to provide an overview of our cybersecurity program to the Board of Directors, including a review of key strategies, emerging
risks, and a summary of key performance indicators.
 
Item
2. Properties
 
We
conduct our business through our executive office, located in Provo, Utah, with approximately 1,600 square feet of office space. We believe
that the lease to which we are subject is generally on terms consistent with prevailing market terms, and none of the leases are with
our affiliates. We believe that our facilities are in good condition and are adequate to meet our operating needs for the foreseeable
future.
 
Item
3. Legal Proceedings
 
To
the best of our knowledge, there are no legal proceedings pending or threatened against us; and there are no actions pending or threatened
against any of our directors or officers that are adverse to us.
 
Item
4. Mine Safety Disclosures
 
Not
applicable.
 

25
 

 
PART
II
 
Item
5. Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
 
Market
Information
 
Our
common stock is quoted on the OTCQB under the symbol “SUND.” There is no “established
trading market” for our shares of common stock. No assurance can be given that any established trading market for our common stock
will develop or be maintained, and if an established trading market develops in the future, the sale of shares of our common stock that
are deemed to be “restricted securities” or “control securities” pursuant to Rule 144 of the SEC by members of
management or others may have a substantial adverse impact on any such market.
 
Holders
 
We
had 102 stockholders of record as of July 1, 2024 and an indeterminate number of stockholders who hold shares in “street name”.
 
Dividends
 
There
are no present material restrictions that limit our ability to pay dividends on our common or preferred stock. Presently, we have no
plans to pay any dividends in the foreseeable future. Our Board of Directors intends to pursue a policy of retaining earnings, if any,
for use in our operations and to finance expansion of our business. Any declaration and payment of dividends in the future, of which
there can be no assurance, will be determined by our Board of Directors in light of conditions then existing, including our earnings,
financial condition, capital requirements and other factors. There are presently no dividends which are accrued or owing with respect
to our outstanding common stock. No assurance can be given that dividends will ever be declared or paid on our common stock in the future.
 
Recent
Sales of Unregistered Securities
 
During
the year ended March 31, 2023 the Company issued 264,600 warrants to the Chairman of the Board of Directors and 120,000 warrants to Radiant
Life, LLC in conjunction with monies borrowed during the period (see Note 8). The exercise price of these warrants was $1.05. The value
of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $365,502. The inputs used in this
calculation included a fair value of the underlying common stock of $1.049 per share, a risk-free between 3.62% and 4.31%, volatility
between 142.23% and 148.56% and a dividend rate of 0%.
 
During
the year ended March 31, 2023, the Company issued 339,749 warrants to Mr. Dickman, 719,300 warrants to the Chairman of the Board of Directors,
and 649,754 warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note 8) per the
terms outlined above. The exercise price of these warrants was $1.05. The value of the warrants on the date of grant, as calculated by
the Black-Scholes-Merton valuation model was $1,678,810. The inputs used in this calculation included a fair value of the underlying
common stock of $1.049 per share, a risk-free between 3.49% and 3.95%, volatility between 142.92% and 145.49% and a dividend rate of
0%.
 
On
August 15, 2023, we issued a private placement memorandum offering to raise up to $1,500,000 through the issuance of restricted shares
of our common stock (par value $0.001) to qualified investors. From September 20, 2023 to October 4, 2023, we received subscription agreements
from investors, for 850,000 common shares at a purchase price of $1 per share, including 1,700,000 warrants exercisable at $0.35 per
share, vested immediately upon issuance, with a five year expiration. Proceeds to us totaled $850,000.
 
During
the year ended March 31, 2024 the Company issued 281,900 warrants to the Chairman of the Board of Directors and 80,000 warrants to Radiant
Life, LLC in conjunction with monies borrowed during the period (see Note 8 to the financial statements included in this report). The exercise price of these warrants was $1.05. The value
of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $316,756. The inputs used in this
calculation included a fair value of the underlying common stock of $1.049 per share, a risk-free between 3.36% and 4.29%, volatility
between 86.52% and 89.11% and a dividend rate of 0%.
 
During
the year ended March 31, 2024, the Company issued 1,106,000 warrants to Mr. Dickman, 772,275 warrants to the Chairman of the Board of
Directors, and 699,754 warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note 8 to the financial statements included in this report) per the terms outlined above. The exercise price of these warrants was between $0.41 and $1.05. The value of the warrants on the date
of grant, as calculated by the Black-Scholes-Merton valuation model was $964,277. The inputs used in this calculation included a fair
value of the underlying common stock between $0.409 and $1.049 per share, a risk-free between 3.80% and 4.01%, volatility between 84.00%
and 89.07% and a dividend rate of 0%.
 

26
 

 
Purchases
of Equity Securities by Us and Affiliated Purchasers
 
None.
 
Item
6. [Reserved.]
 
Item
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
 
Forward-looking
Statements
 
When
used in this Annual Report, the words “may,” “will,” “expect,” “anticipate,” “continue,”
“estimate,” “project,” “intend,” and similar expressions are intended to identify forward-looking
statements regarding events, conditions, and financial trends that may affect our future plans of operations, business strategy, operating
results, and financial position. Persons reviewing this Annual Report are cautioned that any forward-looking statements are not guarantees
of future performance and are subject to risks and uncertainties and that actual results may differ materially from those included within
the forward-looking statements as a result of various factors. Such factors are discussed further below under “Trends and Uncertainties,”
and also include general economic factors and conditions that may directly or indirectly impact our financial condition or results of
operations. Reference is also made to the caption “Forward-Looking Statements” at the forepart of this Annual Report, which
information is incorporated herein by reference.
 
Overview
 
Our
historical business model has focused on purchasing or acquiring life insurance policies and residual interests in or financial products
tied to life insurance policies, including notes, drafts, acceptances, open accounts receivable and other obligations representing part
or all of the sales price of insurance, life settlements and related insurance contracts being traded in the secondary marketplace, often
referred to as the “life settlements market.”
 
We
currently do not hold life settlement or life insurance policies but, rather, previously held a contractual right to receive the net
insurance benefits, or “NIBs”, from a portfolio of life insurance policies held by a third party (“the Owners”
or “the Holders”). These NIBs represented an indirect, residual ownership interest in a portfolio of individual life insurance
policies, and they allowed us to receive a portion of the settlement proceeds from such policies, after expenses related to the acquisition,
financing, insuring and servicing of the policies underlying our NIBs have been paid.
 
NIBs
are generally sold by an entity that holds the underlying life settlement or life insurance policies, either directly or indirectly through
a subsidiary, such an entity being referred to herein as a “Holder.” A Holder, either directly or through a wholly owned
subsidiary, purchases life insurance policies either from the insured or on the secondary market and aggregates them into a portfolio
of policies. At the time of purchase, the Holder also (i) contracts with a service provider to manage the servicing of the policies until
maturity, (ii) consider purchasing mortality re-insurance (“MRI”) coverage under which payments will be made to the Holder
in the event the insurance policies do not mature according to actuarial life expectancies, and (iii) arranges financing to cover the
initial purchase of the insurance policies, the servicing of the life insurance policies until maturity and the payment of the MRI premiums.
The financing obtained by the Holder for a portfolio of life settlement or life insurance policies is secured by the insurance policies
for which the financing was obtained. After a Holder purchases policies, aggregates them into a portfolio and arranges for the servicing,
MRI coverage and financing, the Holder contracts to sell NIBs related to the policies, which gives the holder of the NIBs the right to
receive the proceeds from the settlement of the insurance policies after all of the expenses related to such policies have been paid.
When an insurance policy underlying our NIBs comes to maturity, the insurance proceeds are first used to pay expenses associated with
such policy. Once all of the expenses have been paid, the Holder will retain a small percentage of the proceeds and then will pay the
remaining insurance proceeds to us.
 

27
 

 
During
the latter part of the fiscal year ended March 31, 2021, we began developing an additional business offering, providing professional
services to specialty structured finance groups, bond issuers and life settlement aggregators. We have assembled an experienced team
from the life settlement marketplace, as well as from other areas such as financial services and public financial markets. As a professional
services provider, we apply industry best practices to advise on the selection of specific portfolios of life insurance policies that
are tailored to meet the needs of its clients. Our clients may include bond issuers, bond investors, or other structured finance product
issuers. We develop strategies and methodologies which include the acquisition of life insurance portfolios, then uses common structured
finance techniques and proprietary analytics to structure bonds for issuances, including principal protected bonds. Our goal is to deliver
long-term value and profitability to shareholders by growing our professional services business and asset base, resulting in the ability
to pay dividends to its shareholders.
 
During
the latter part of the year ended March 31, 2021, we began working closely with bond placement agents and aggregators to establish various
aspects of a proprietary, investment grade bond offering. In this arrangement, we participate as the sole originator in the role of structuring
and advising on the structure of the proprietary bond instrument. Included in the role of structuring financial assets, we use proprietary
analytics to establish the makeup of the rated instrument, including but not limited to, life settlement assets (life insurance policies)
and managed cash, and implements a process of selective assembly of the underlying assets and cash management that will meet the policy
requirements and analytics. We provide current and ongoing resources for all analytics, as well as advisement support for the investment
and non-investment grade ratings for the managed asset pool and the managed cash accounts. In our advisory role, we are reimbursed for
all expenses associated with the structuring and preparation of any bond offering, will receive an advisory payment upon the closing
of any bond offering, and then will hold residual rights on the balance of assets once the bond is retired.
 
On
January 1, 2022, we entered into a marketing and consulting agreement with Tradability, LLC (“Consultant”) that required
us to make an initial $100,000 payment and up to an additional $400,000 in the future (which will
be financed by the Consultant via a promissory note). The $400,000 obligation is contingent upon the Consultant and us successfully reaching
certain milestones. Further, the agreement requires us to issue between 1,000,000 and 10,000,000 stock options (which are exercisable
into our common stock at prices between $1.00 to $2.50 per share) contingent upon the Consultant and us successfully reaching certain
milestones. The milestones primarily relate to the Consultant finalizing the tokenization of 500 million non-fungible tokens (“NFTs”)
and the successful placement of NFTs with proceeds of between $100 million and $500 million. The proceeds will be used to purchase Life
Settlements for which we will be an advisor. As of July 1, 2024 none of the milestones related
to the potential issuance of equity have been met. This Company has terminated this agreement with Tradability, and no future payments are expected in association with
this terminated agreement.
 
Results
of Operations
 
Fiscal
year ended March 31, 2024 compared to March 31, 2023
 
General
& Administrative Expenses
 
General
and administrative expenses totaled $531,406 and $682,283 during the years ended March 31, 2024, and 2023, respectively. A significant
portion of these expenses were professional fees, payroll, and rent expenses. The reduction in general and administrative expenses is because we had reduced
professional fees during 2024.
 
Other
Income and Expenses
 
During
the years ended March 31, 2024, and 2023, we recognized $1,047,729, and $1,745,808, respectively, as loss on extinguishment of debt in
conjunction with related party debt. The reduction in loss on extinguishment of debt is because we extinguished less debt at a loss during
2024.
 
For
the years ended March 31, 2024, and 2023, interest expense totaled $410,856 and $329,890, respectively. The increase in interest expense
was a result of higher loan balances, and $67,890 recognized on amortization of debt discount. For the years ended March 31, 2024, and
2023, expenses incurred pursuing potential financing alternatives totaled $135,000 and $54,000, respectively. The increase in financing
expense is due to expenses incurred in pursuing bonding.
 
Income
Taxes
 
During
the years ended March 31, 2024, and 2023, the Company recorded a net loss before income taxes of $1,834,991 and $2,811,981,
respectively. The reduction in net loss is largely due to decrease in losses from extinguishing debt.
 

28
 

 
Liquidity
and Capital Resources
 
Since
our inception our operations have been primarily financed through sales of equity instruments, debt financing, lines of credit and notes
payable from related parties and the issuance of convertible debentures. As of March 31, 2024, we had $329,860 of cash, compared to $553
as of March 31, 2023. As of March 31, 2024, the Company had access to draw an additional $4,265,942 on the notes payable, related party,
and $3,000,000 on the Convertible Debenture Agreement. Our monthly expenses are approximately $44,000, which includes salaries of our
employee, policy servicing expenses, consulting agreements and contract labor, general and administrative expenses and estimated legal
and accounting expenses. Outstanding Accounts Payable as of March 31, 2024, totaled $447,862, and other accrued liabilities totaled $1,790,940
. We believe that our availability under our existing lines of credit with related parties, our existing capital resources, together
with the issuance of additional notes payable and convertible debentures will be sufficient to fund our operating working capital requirements
for the 12 months from the issuance of the financial statements.
 
2024
Cash Flows Compared to 2023 Cash Flows
 
For
the year ended March 31, 2024, we recorded net cash used in operating activities of $666,643, compared to $459,713 used in operating
activities during the year ended March 31, 2023.
 
For
the years ended March 31, 2024, and 2023 no cash was used in or provided by investing activities.
 
During
the years ended March 31, 2024, and 2023 net cash provided by financing activities was $995,950, and $192,300, respectively. Financing
activities for both years consisted of borrowing on new related party promissory notes and existing notes payable and lines-of-credit
in the amounts of $180,950, and $192,300, respectively. Additionally, during the years ended March 31, 2024, and 2023, the Company received
$850,000 and $0 in proceeds raised by issuance of our common stock through private placement memorandums, respectively.
 
Debt
 
At
March 31, 2024, we owed $5,205,617, including accrued interest, for debt obligations. We owed $3,340,058 in principal pursuant to notes
payable and lines-of-credits from related parties and $300,000 in other notes payable. As of March 31, 2024, one note payable had a principal
balance of $1,159,508 and is due on November 30, 2025, and a line-of-credit had a principal balance of $50,000 and is due on July 29,
2024, or when the Company completes a successful equity raise (if earlier than the due date), at which time principal and interest is
due in full. The second note payable and line-of-credit had a principal balance of $1,304,550, and the line of credit is due November
30, 2025. The third series of related-party promissory notes had a total principal balance of $826,000 and  has
been extended to  be due on November 30, 2025. The convertible debenture agreement, which has no principal balance due as of March
31, 2024, is open through November 30, 2024. As of July 1, 2024, there was $4,265,942 available under the lines-of-credit we currently
have with related parties and $3,000,000 available under the 8% convertible debenture agreement.
 
We
may borrow money in the future to finance our operations but can make no guarantees that such credit will be made available to us. Any
such borrowing will increase the risk of loss to the debt holder in the event we are unsuccessful in repaying such loans.
 
The
accompanying financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize
its assets and satisfy its liabilities in the normal course of business. As the company has no current source of revenues, in order to
meet financial obligations, the Company will need to continue to rely on debt financing from related parties and/or raise additional
capital. Management has concluded that its existing capital resources and availability under its existing convertible debentures and
debt agreements with related parties will be sufficient to fund its operating working capital requirements for at least the next 12 months,
or through June 2025. Related parties have given assurance that their continued support, by way of either extensions of due dates, or
increases in lines-of-credit, can be relied on. The Company also continues to evaluate other debt and equity financing opportunities.
 

29
 

 
Contractual
Obligations and Contingencies
 
The
following table sets forth payments due by period for fixed contractual obligations by maturity date as of March 31, 2024:
 


  
   
Maturity Date 

  
Total  
Year Ended March 31, 2025  
Year Ended March 31, 2026  
Thereafter 

Debt Obligations (1) 
$3,640,058  
$350,000  
$3,290,058  
$- 

Interest Payable 
$1,565,559  
$207,821  
$1,357,738  
$- 

Total 
$5,205,617  
$557,821  
$4,647,796  
$- 

 


(1)
Debt
    obligations consist of the principal pursuant to the notes payable from related parties and non-related parties (as mentioned above)

 
Critical
Accounting Policies and Estimates
 
The
preparation of our financial statements requires that we make estimates and judgments. We base these on historical experience and on
other assumptions that we believe to be reasonable.
 
Estimates,
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
 
Stock
Based Compensation and Financing Costs, we measure stock-based compensation expense related to employee stock-based awards and stock
based expense associated with certain financing costs based on the estimated fair value of the awards as determined on the date of grant
and is recognized as expense over the remaining requisite service period or vesting period of the warrant. We utilize the Black-Scholes
pricing model to estimate the fair value of stock options issued as compensation and warrants issued as financing costs. The Black-Scholes
model requires the input of highly subjective and complex assumptions, including the estimated fair value of our common stock on the
date of grant, the expected term of the stock option and warrant, and the expected volatility of our common stock over the period equal
to the expected term of the grant or warrant. Uncontrollable uncertainties, such as fluctuation in interest rates, can have an effect
on our Black-Scholes estimate calculations. Such fluctuations and other unforeseen changes in inputs could have a material impact on
the general and administrative expenses within our financial statements. Our estimates forfeitures at the date of grant and revises the
estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
 
Fair
Value, As defined by ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), fair value is
the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. ASC 820 also requires the consideration of differing levels of inputs in the determination of fair values.
 
Those
levels of input are summarized as follows:
 
●
Level 1: Quoted prices in active markets for identical assets and liabilities.
 
●
Level 2: Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets, quoted
prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant
assumptions are observable in the market.
 
●
Level 3: Unobservable inputs that are supported by little or no market activity. Level 3 assets and liabilities include financial instruments
whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques as well as instruments for
which the determination of fair value requires significant management judgment or estimation.
 
The
level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that
is significant to the fair value measurement in its entirety.
 
We
did not have any transfers of assets and liabilities between Levels 1, 2 and 3 of the fair value measurement hierarchy during the years
ended March 31, 2024, and 2023.
 
Our
recorded values of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair values based on their short-term
nature. The recorded values of the Notes Payable, Related Parties and Convertible Debenture approximates the fair values as the interest
rate approximates market interest rates.
 

30
 

 
Item
8. Financial Statements and Supplementary Data
 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
INDEX
TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS
 


 
Page(s)

 
 

Report
    of Independent Registered Public Accounting Firm (PCAOB ID: 3627) 
F-1

 
 

Consolidated Balance Sheets as of March 31, 2024, and 2023
F-2

 
 

Consolidated Statements of Operations for the Years Ended March 31, 2024, and 2023
F-3

 
 

Consolidated Statements of Stockholders’ Deficit for the Years Ended March 31, 2024, and 2023
F-4

 
 

Consolidated Statements of Cash Flows for the Years Ended March 31, 2024, and 2023
F-5

 
 

Notes to the Consolidated Financial Statements
F-6

 

31
 

 
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
To the Shareholders and the Board of Directors of
Sundance Strategies, Inc.:
 
Opinion on the Financial Statements
 
We have audited the accompanying consolidated balance
sheets of Sundance Strategies, Inc. and Subsidiary (“the Company”) as of March 31, 2024 and 2023, the related consolidated
statements of operations, stockholders’ deficit, and cash flows for each of the years in the two-year period ended March 31, 2024
and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements referred
to above present fairly, in all material respects, the financial position of the Company as of March 31, 2024 and 2023, and the results
of its operations and its cash flows for each of the years in the two-year period ended March 31, 2024, in conformity with accounting
principles generally accepted in the United States of America.
 
Basis for Opinion
 
These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our
audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”)
and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable
rules and regulations of the Securities and Exchange Commission and the PCAOB.
 
We conducted our audits in accordance with the standards
of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform,
an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal
control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal
control over financial reporting. Accordingly, we express no such opinion.
 
Our audits included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
 
Critical Audit Matters
 
The critical audit matters communicated below are
matters arising from the current-period audit of the consolidated financial statements that were communicated or required to be communicated
to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved
our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our
opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a
separate audit opinion on the critical audit matters or on the accounts or disclosures to which it relates.
 
Evaluation of a Going Concern
 
Description of the Critical Audit Matter
 
As described further in Note 9 to the financial
statements, the Company has relied on debt and equity financing to finance operations, as there are not sufficient cash flows from operations,
which raises doubt about its ability to continue as a going concern. Management has implemented plans to alleviate the substantial doubt.
Management plans to address the concerns, as needed, by (a) utilizing recent financing obtained through notes payable; (b) utilizing current
lines of credit. When considering these factors in conjunction with the Company’s operating plan, management believes it has sufficient
ability to fund operations and satisfy the Company’s obligations as they come due for at least one year from the financial statement
issuance date.
 
We determined the Company’s ability
to continue as a going concern is a critical audit matter due to the estimation and execution uncertainty regarding the Company’s
available capital and the risk of bias in management’s judgments and assumptions in their determination.
 
How the Critical Audit Matter Was Addressed
in the Audit
 
Our audit procedures related to the Company’s
assertion on its ability to continue as a going concern included the following, among others:
 

●We performed testing procedures such as analytical procedures to identify conditions and events that indicate
there could be substantial doubt about the entity’s ability to continue as a going concern for a reasonable period of time.

●We reviewed and evaluated management’s plans for dealing with adverse effect of these conditions
and events that raised doubt about the Company’s ability to continue as a going concern.

●We tested the reasonableness of management’s assessment of whether the Company has sufficient liquidity
to fund operations for at least one year from the financial statement issuance date.

●We assessed whether the Company’s determination that there is substantial doubt about its ability
to continue as a going concern was adequately disclosed.
 
/s/ Sadler, Gibb & Associates, LLC
 
We have served as the Company’s auditor since
2018.
 
Draper, UT
July 1, 2024
 

F-1
 

 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
Consolidated
Balance Sheets
 


  
March 31,  
March 31, 

  
2024  
2023 

  
   
  

ASSETS 
    
   

  
    
   

Current Assets 
    
   

Cash and cash equivalents 
 329,860  
$553 

Prepaid expenses and other assets 
 9,075  
 8,295 

  
    
   

Total Current Assets 
 338,935  
 8,848 

  
    
   

Total Current Assets 
$338,935  
$8,848 

  
    
   

LIABILITIES AND STOCKHOLDERS’ DEFICIT 
    
   

  
    
   

Current Liabilities 
    
   

Accounts payable 
$447,862  
$753,050 

Accrued expenses 
 433,201  
 574,558 

Current portion of notes payable 
 300,000  
 300,000 

Current portion of notes payable, related parties 
 50,000  
 876,000 

Stock repurchase payable 
 400,000  
 400,000 

Total Current Liabilities 
 1,631,063  
 2,903,608 

  
    
   

Long-Term Liabilities 
    
   

Accrued expenses 
 1,357,739  
 857,685 

Notes payable, related parties, net of current portion, net of debt discount 
 3,290,058  
 2,281,463 

  
    
   

Total Long-Term Liabilities 
 4,647,797  
 3,139,148 

  
    
   

Total Liabilities 
 6,278,860  
 6,042,756 

  
    
   

Stockholders’ Deficit 
    
   

Preferred stock, authorized 10,000,000 shares, par value $0.001; -0- shares issued and
    outstanding 
 -  
 - 

Common stock, authorized 500,000,000 shares, par value $0.001; 42,258,441 shares issued and
    outstanding as of March 31, 2024; and 41,408,441 shares issued and oustanding as of March 31, 2023 
 42,259  
 41,409 

Additional paid-in capital 
 30,914,682  
 28,986,558 

Accumulated deficit 
 (36,896,866) 
 (35,061,875)

  
    
   

Total Stockholders’ Deficit 
 (5,939,925) 
 (6,033,908)

  
    
   

Total Liabilities and Stockholders’ Deficit 
$338,935  
$8,848 

 
The
accompanying notes are an integral part of these consolidated financial statements.
 

F-2
 

 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
Consolidated
Statements of Operations
 


  
2024  
2023 

  
Years Ended March 31, 

  
2024  
2023 

  
   
  

Income from Investments 
$-  
$- 

  
    
   

General and Administrative Expenses 
 531,406  
 682,283 

  
    
   

Loss from Operations 
 (531,406) 
 (682,283)

  
    
   

Other Income (Expense) 
    
   

Loss on extinguishment of debt 
 (1,047,729) 
 (1,745,808)

Gain on settlement of liabilities 
 290,000  
 - 

Interest expense 
 (410,856) 
 (329,890)

Financing expense 
 (135,000) 
 (54,000)

  
    
   

Total Other Income (Expense) 
 (1,303,585) 
 (2,129,698)

  
    
   

Loss Before Income Taxes 
 (1,834,991) 
 (2,811,981)

Income Tax Provision (Benefit) 
 -  
 - 

  
    
   

Net Loss 
$(1,834,991) 
$(2,811,981)

  
    
   

Loss per share - basic and diluted 
$(0.04) 
$(0.07)

  
    
   

Weighted average shares outstanding - basic and diluted 
 41,693,714  
 41,408,441 

 
The
accompanying notes are an integral part of these consolidated financial statements.
 

F-3
 

 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
Consolidated
Statements of Stockholders’ Deficit
For
the Year Ended March 31, 2024 and 2023
 


  
   
   
Additional  
   
Total 

  
Common Stock  
Paid-In  
Accumulated  
Stockholders’ 

  
Shares  
Amount  
Capital  
Deficit  
Deficit 

  
   
   
   
   
  

Balance, March 31, 2022 
 41,408,441  
$41,409  
$27,181,618  
$(32,249,894) 
$(5,026,867)

  
    
    
    
    
   

  
    
    
    
    
   

Warrants issued in connection with debt issuances 
 -  
 -  
 126,130  
 -  
 126,130 

  
    
    
    
    
   

Warrants issued in connection to extinguishment of debt 
 -  
 -  
 1,678,810  
 -  
 1,678,810 

  
    
    
    
    
   

Net loss 
 -  
 -  
 -  
 (2,811,981) 
 (2,811,981)

  
    
    
    
    
   

Balance, March 31, 2023 
 41,408,441  
$41,409  
$28,986,558  
$(35,061,875) 
$(6,033,908)

Balance 
 41,408,441  
$41,409  
$28,986,558  
$(35,061,875) 
$(6,033,908)

  
    
    
    
    
   

Common stock and warrants issued for cash 
 850,000  
 850  
 849,150  
 -  
 850,000 

  
    
    
    
    
   

Warrants issued in connection with debt issuances 
 -  
 -  
 114,697  
 -  
 114,697 

  
    
    
    
    
   

Warrants issued in connection to extinguishment of debt 
 -  
 -  
 964,277  
 -  
 964,277 

  
    
    
    
    
   

Net loss 
 -  
 -  
 -  
 (1,834,991) 
 (1,834,991)

  
    
    
    
    
   

Balance, March 31, 2024 
 42,258,441  
$42,259  
$30,914,682  
$(36,896,866) 
$(5,939,925)

Balance 
 42,258,441  
$42,259  
$30,914,682  
$(36,896,866) 
$(5,939,925)

 
The
accompanying notes are an integral part of these consolidated financial statements.
 

F-4
 

 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
Consolidated
Statements of Cash Flows
 


  
2024  
2023 

  
Years Ended March 31, 

  
2024  
2023 

  
   
  

Operating Activities 
    
   

  
    
   

Net Loss 
$(1,834,991) 
$(2,811,981)

Adjustments to reconcile net loss to net cash used in operating activities: 
    
   

Loss on extinguishment of debt 
 1,047,729  
 1,745,808 

Gain on settlement of liabilities 
 (290,000) 
 - 

Amortization of debt discount 
 67,890  
 22,487 

Changes in operating assets and liabilities 
    
   

Prepaid expenses and other assets 
 (780) 
 (128)

Accounts payable 
 (15,188) 
 412,023 

Accrued expenses 
 358,697  
 172,078 

  
    
   

Net Cash used in Operating Activities 
 (666,643) 
 (459,713)

  
    
   

Financing Activities 
    
   

  
    
   

Proceeds from issuance of common stock and warrants – net of issuance costs 
 850,000  
 - 

Proceeds from issuance of notes payable, related party 
 180,950  
 192,300 

Repayment of notes payable, related party 
 (35,000) 
 - 

  
    
   

Net Cash provided by Financing Activities 
 995,950  
 192,300 

  
    
   

Net Change in Cash and Cash Equivalents 
 329,307  
 (267,413)

Cash and Cash Equivalents at Beginning of Period 
 553  
 267,966 

  
    
   

Cash and Cash Equivalents at End of Period 
$329,860  
$553 

  
    
   

Supplemental disclosure of cash flow information: 
    
   

Cash paid for interest 
$-  
$- 

Cash paid for income taxes 
$-  
$- 

  
    
   

Non Cash Financing & Investing Activities, and Other Disclosures 
    
   

Issued warrants as debt issuance costs 
$114,697  
$126,130 

 
The
accompanying notes are an integral part of these audited consolidated financial statements.
 

F-5
 

 
SUNDANCE
STRATEGIES, INC. AND SUBSIDIARY
NOTES
TO CONSOLIDATED FINANCIAL STATEMENTS
March
31, 2024, and 2023
 
(1) ORGANIZATION AND BASIS OF PRESENTATION
 
Sundance
Strategies, Inc. (formerly known as Java Express, Inc.) was organized under the laws of the State of Nevada on December 14, 2001, and
engaged in the retail selling of beverage products to the general public until these endeavors ceased in 2006; it had no material business
operations from 2006, until its acquisition of ANEW LIFE, INC. (“ANEW LIFE”), a subsidiary of Sundance Strategies, Inc. (“Sundance
Strategies”, “the Company”, “we” or “our”).
 
Our
historical business model has focused on purchasing or acquiring life insurance policies and residual interests in or financial products
tied to life insurance policies, including notes, drafts, acceptances, open accounts receivable and other obligations representing part
or all of the sales price of insurance, life settlements and related insurance contracts being traded in the secondary marketplace, often
referred to as the “life settlements market.”
 
During
the latter part of the fiscal year ended March 31, 2021, the Company began developing an additional business offering, providing professional
services to specialty structured finance groups, bond issuers and life settlement aggregators. The Company has now assembled an experienced
team from the life settlement marketplace, as well as from other areas such as financial services and public financial markets. As a
professional services provider, the Company applies industry best practices to advise on the selection of specific portfolios of life
insurance policies that are tailored to meet the needs of its clients. The Company’s clients may include bond issuers, bond investors,
or other structured finance product issuers. The Company develops strategies and methodologies which include the acquisition of life
insurance portfolios, then uses common structured finance techniques and proprietary analytics to structure bonds for issuances, including
principal protected bonds. The Company’s goal is to deliver long-term value and profitability to shareholders by growing the Company’s
professional services business and asset base, resulting in the ability to pay dividends to its shareholders.
 
During
the latter part of the year ended March 31, 2021, the Company began working closely with bond placement agents and aggregators to establish
various aspects of a proprietary, investment grade bond offering. In this arrangement, the Company participates as the sole originator
in the role of structuring and advising on the structure of the proprietary bond instrument. Included in the role of structuring financial
assets, the Company uses proprietary analytics to establish the makeup of the rated instrument, including but not limited to, life settlement
assets (life insurance policies) and managed cash, and implements a process of selective assembly of the underlying assets and cash management
that will meet the policy requirements and analytics. The Company provides current and ongoing resources for all analytics, as well as
advisement support for the investment and non-investment grade ratings for the managed asset pool and the managed cash accounts. In its
advisory role, the Company is reimbursed for all expenses associated with the structuring and preparation of any bond offering, will
receive an advisory payment upon the closing of any bond offering, and then will hold residual rights on the balance of assets once the
bond is retired.
 
On
January 1, 2022, the Company entered into a marketing and consulting agreement with Tradability, LLC (“Consultant”) that
requires the Company to make an initial $100,000 payment and up to an additional $400,000 in the future (which will be financed by the
Consultant via a promissory note). The $400,000 obligation is contingent upon the Consultant and the Company successfully reaching certain
milestones. Further, the agreement requires the Company to issue between 1,000,000 and 10,000,000 stock options (which are exercisable
into the Company’s common stock at prices between $1.00 to $2.50 per share) contingent upon the Consultant and the Company successfully
reaching certain milestones. The milestones primarily relate to the Consultant finalizing the tokenization of 500 million non-fungible
tokens (“NFTs”) and the successful placement of NFTs with proceeds of between $100 million and $500 million. The proceeds
will be used to purchase Life Settlements for which the Company will be an advisor. As of March 31, 2024 and the issuances of these financial
statements, none of the milestones related to the potential issuance of equity have been met. This Company has terminated this agreement with Tradability, and no future payments are expected in association with
this terminated agreement.
 

F-6
 

 
(2)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Estimates,
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent
assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
 
Cash
and Cash Equivalents, For purposes of reporting cash flows, the Company considers all highly-liquid debt instruments purchased with
an original maturity of three months or less to be cash equivalents.
 
Basic
and Diluted Net Loss Per Common Share, Basic net loss per common share is computed by dividing net loss by the weighted average number
of common shares outstanding during the periods presented using the treasury stock method. Diluted net loss per common share is computed
by including common shares that may be issued subject to existing rights with dilutive potential, when applicable. Potential dilutive
common stock equivalents are primarily comprised of potential dilutive shares resulting from convertible debt agreements and common stock
warrants. Potentially dilutive shares resulting from convertible debt agreements are evaluated using the if-converted method. Potentially
dilutive securities are not included in the calculation of diluted net loss per share for the years ended March 31, 2024, and 2023, because
to do so would be anti-dilutive. Potentially dilutive securities outstanding as of March 31, 2024, and 2023, include warrants convertible
into 14,043,573 and 9,403,644 shares of common stock, respectively.
 
Stock-Based
Compensation and Financing Costs, The Company measures stock-based compensation expense related to employee stock-based awards and
stock-based expense associated with certain financing costs on the estimated fair value of the awards as determined on the date of grant
and is recognized as expense over the remaining requisite service period for options and vesting period for warrants. The Company utilizes
the Black-Scholes pricing model to estimate the fair value of stock options issued as compensation and warrants issued as financing costs.
The Black-Scholes model requires the input of highly subjective and complex assumptions, including the estimated fair value of the Company’s
common stock on the date of grant, the expected term of the stock option and warrant, and the expected volatility of the Company’s
common stock over the period equal to the expected term of the grant. The Company estimates forfeitures at the date of grant and revises
the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
 
Income
Taxes, The Company accounts for income taxes under FASB ASC 740, “Income Taxes”. Deferred income tax assets and liabilities
are determined based upon differences between the financial reporting and tax basis of assets and liabilities and are measured using
the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Accounting standards require the
consideration of a valuation allowance for deferred tax assets if it is “more likely than not” that some component or all
of the benefits of deferred tax assets will not be realized.
 
The
tax effects from an uncertain tax position can be recognized in the financial statements only if the position is more likely than not
of being sustained if the position were to be challenged by a taxing authority. The Company has examined the tax positions taken in its
tax returns and determined that there are no uncertain tax positions. As a result, the Company has recorded no uncertain tax liabilities
in its balance sheet. Interest and penalties for uncertain positions, when applicable, would be recognized as a component of income tax
expense.
 
The
Company files United States Federal and State income tax returns. The income tax returns of the Company are subject to examination by
taxing authorities for three to five years from the date they are filed. The Company has tax returns subject to examination for 2017-2022.
 
Principles
of Consolidation, The consolidated financial statements include the accounts of the Company and its subsidiary. The subsidiary is
wholly owned. All intercompany accounts and transactions are eliminated in consolidation.
 
Fair
Value, As defined by ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), fair value is
the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date. ASC 820 also requires the consideration of differing levels of inputs in the determination of fair values.
 

F-7
 

 
Those
levels of input are summarized as follows:
 
●
Level 1: Quoted prices in active markets for identical assets and liabilities.
 
●
Level 2: Observable inputs other than Level 1 quoted prices, such as quoted prices for similar instruments in active markets, quoted
prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant
assumptions are observable in the market.
 
●
Level 3: Unobservable inputs that are supported by little or no market activity. Level 3 assets and liabilities include financial instruments
whose value is determined using pricing models, discounted cash flow methodologies, or similar techniques as well as instruments for
which the determination of fair value requires significant management judgment or estimation.
 
The
level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest level input that
is significant to the fair value measurement in its entirety.
 
The
Company did not have any transfers of assets and liabilities between Levels 1, 2 and 3 of the fair value measurement hierarchy during
the years ended March 31, 2024, and 2023.
 
The
Company’s recorded values of cash and cash equivalents, accounts payable and accrued liabilities approximate their fair values
based on their short-term nature. The recorded values of the Notes Payable, Related Parties and Convertible Debenture approximates the
fair values as the interest rate approximates market interest rates.
 
(3)
NEW ACCOUNTING PRONOUNCEMENTS
 
The
Company has reviewed all other recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any,
on its results of operations, financial position or cash flows. Based on that review, the Company believes that none of these pronouncements
will have a significant effect on its financial statements.
 
(4)
CASH AND CASH EQUIVALENTS
 
Cash
and cash equivalents consist principally of currency on hand and demand deposits at commercial banks. The Company had $329,860
and $553
in cash and cash equivalents as of March 31, 2024, and 2023, respectively. The Company maintains non-interest-bearing accounts at
two financial institutions. The accounts at these institutions are insured by the Federal Deposit Insurance Corporation (FDIC) up to
$250,000. As of March 31, 2024, and 2023, the Company had balances in excess of FDIC insured amounts at these institutions
of $79,779 and $0, respectively.
 
(5)
NOTES PAYABLE
 
On
April 6, 2021, the Company borrowed $300,000 under an unsecured promissory note with Satco International, Ltd. This promissory note bears
interest at a rate of 8% annually and was due January 6, 2022. In conjunction with this note, the Company issued warrants for 1,000,000
shares of common stock, exercisable at $1.00 per share and expiring in 3 years from the date of the promissory note. On June
9, 2023, the unsecured promissory note with Satco International, Ltd. was amended to extend the
due date from April 6, 2023 to August 31, 2024 ,
or at the immediate time when alternative financing or other proceeds are received. This extension has no bearing on the warrants that
were issued in conjunction with the original promissory note. This note is separate from the 8% convertible debenture agreement that
the Company has in place with Satco International, Ltd. (see note 8). As of March 31, 2024 accrued
interest on the note totaled $71,671.
 
(6)
NOTES PAYABLE, RELATED PARTY
 
As
of March 31, 2024, and 2023, the Company had borrowed $3,340,058 and $3,194,108 respectively, excluding accrued interest, from related
parties. Unamortized debt discount with the Notes Payable, Related party was $0 and $36,645 as of March 31, 2024, and March 31, 2023,
respectively. Short-term accrued interest associated with the Notes Payable, Related Party of $11,925 and $364,908 is recorded on the
balance sheet as an Accrued Expense obligation at March 31, 2024, and March 31, 2023, respectively. Long-term accrued interest associated
with the Notes Payable, Related Party of $1,357,738 and $857,684 is recorded on the balance sheet as an Accrued Expense obligation at
March 31, 2024, and March 31, 2023, respectively.
 

F-8
 

 
Related
Party Promissory Notes
 
As
of both March 31, 2024, and 2023,
the Company owed $826,000
under the unsecured promissory notes from Mr. Dickman. The promissory notes bear interest at a rate of 8%
annually. On November 10, 2022, the notes were amended to extend the due date from
October 31, 2022, to July 31, 2023, or at the immediate time when alternative financing
or other proceeds are received, and on June 5, 2023 and again on January 26, 2024, the notes were amended to extend the due date
from July 31, 2023, to November 30, 2025, or at the immediate time when alternative financing or other proceeds are received. As per
the provision outlined in Note 8, and in conjunction with the extension of the due date of the promissory notes on November 10,
2022, the Company also agreed to provide Mr. Dickman with warrants for 399,749
shares of common stock. In association with the extensions during the fiscal year ended March 31, 2024, the company agreed to
provide Mr. Dickman with warrants for 1,106,000 shares
of common stock (see Note 8) vested immediately upon issuance, having exercise prices of $1.05 and $0.41
per share, and a 5-year exercise window from the dates of issuance. During the years ended March 31, 2024, and March 31, 2023,
the Company neither borrowed any additional funds under this agreement nor made any principal repayments. As of March 31,
2024, accrued interest on the notes totaled $404,087.
In the event the Company completes a successful equity raise all principal and interest on the notes are due in full at that
time. The total number of warrants issued to the related party lender was 3,196,332
as of March 31, 2024 (see Note 8 for further details on these warrants).
 
On
July 29, 2021, the Company entered into an unsecured promissory note agreement with Radiant Life, LLC. This agreement was in conjunction
with the Company borrowing $50,000 of Notes Payable, Related Party, and is not part of the existing note payable and lines of credit
agreement the Company has with Radiant Life, LLC. The promissory note bears interest at a rate of 8% annually and is due on July 29,
2024. In conjunction
with this specific loan event, the agreement awards Radiant Life, LLC with 50,000 common stock warrants, which have an exercise price
of $1.05, and expire in 5 years (see Note 8).
As of March 31, 2024, accrued interest on the note totaled $11,925.
 
Related
Party Note Payable and Line of Credit Agreements
 
As
of March 31, 2024, and 2023, the Company owed $1,304,550
and $1,198,600,
respectively, exclusive of accrued interest, under the note payable and line of credit agreement with Kraig T. Higginson, Chairman
of the Board of Directors and a stockholder. On
February 2, 2023, and again on January 26, 2024, the related party note payable and line of credit agreement was amended to extend
the due date from November 30, 2023 to November 30, 2024 and then to November 30, 2025, or at the immediate time when alternative
financing or other proceeds are received. As of March 31, 2024, the agreement
allowed for borrowings of up to $4,600,000.
During the year ended March 31, 2023, the Company borrowed $132,300
in principal and made no repayments of principal on this agreement. During the year ended March 31, 2024, the Company borrowed
$140,950
in principal and made repayments of $35,000
in principal on this agreement. The note payable and line of credit agreement incurs interest at 7.5%
per annum. As of March 31, 2024, accrued interest on this note totaled $403,361.
As per the provision outlined in Note 8, and in conjunction with the due date extension and the $140,950
and $132,300
borrowed during the years ended March 31, 2024 and 2023, respectively, the Company also agreed to provide the Chairman of the Board
of Directors and a stockholder, with warrants for 1,054,175
shares of common stock and 983,900
shares of common stock, respectively, vested immediately upon issuance, having exercise prices of $1.05
and $0.41 per share, and a 5-year
exercise window from the dates of issuance. The total number of warrants issued to the related party lender was 4,418,225
as of March 31, 2024 (see Note 8 for further details on these warrants).
 
As
of March 31, 2024, and 2023, the Company owed $1,159,508 and $1,119,508 in principal, respectively, under the note payable and lines
of credit agreement with Radiant Life, LLC. The agreement allows for borrowings of up to $2,130,000. On February 2, 2023, and again on
February 1, 2024, the related party note payable and line of credit agreement was amended to extend the due date from November 30, 2023
to November 30, 2024, and later to November 30, 2025, or at the immediate time when alternative financing or other proceeds are received.
The note payable and line of credit agreement incurs interest at 7.5% per annum. During the years ended March 31, 2024, and 2023 the
Company borrowed $40,000 and $60,000, respectively of principal under this agreement and made no repayments. As of March 31, 2024, accrued
interest on this agreement totaled $550,289. As per the provision outlined in Note 8, and in conjunction with the due date extensions
and the $40,000 borrowed under the note payable and lines of credit agreement during the year, the Company also agreed to provide Radiant
Life, LLC with warrants for 779,754 shares of common stock, vested immediately upon issuance, a 5-year exercise window from the dates
of issuance, having  exercise prices between $0.41 and $1.05 per share. The total number of warrants issued to the related party lender
was 3,229,016 as of March 31, 2024 (see Note 8 for further details).
 

F-9
 

 
(7)
CONVERTIBLE DEBENTURE AGREEMENT
 
The
Company has entered into an 8% convertible debenture agreement with Satco International, Ltd., that allows for borrowings of up to $3,000,000.
The holder originally had the option to convert the outstanding principal and accrued interest to unregistered, restricted common stock
of the Company on June 2, 2016. Per the agreement, the number of shares issuable at conversion shall be determined by the quotient obtained
by dividing the outstanding principal and accrued and unpaid interest by 90% of the 90-day average closing price of the Company’s
common stock from the date the notice of conversion is received; and the price at which the Debenture may be converted will be no lower
than $1.00 per share. The original maturity date was June 2, 2016, but was later extended, through a series of extensions, to November
30, 2023. On February 9, 2023 the convertible debenture agreement with Satco International, Ltd. was amended to extend the due date from
November 30, 2023, to November 30, 2024, or at the immediate time when alternative financing or other proceeds are received. This extension
has no bearing on the warrants that were issued in conjunction with the original promissory note.
 
As
of March 31, 2024 and March 31, 2023, the Company owed $0 under the agreement, excluding accrued interest. The associated interest of
$124,225 is recorded on the balance sheet as an Accrued Expense obligation at March 31, 2024, and 2023.
 
(8)
STOCKHOLDERS’ EQUITY
 
Common
Stock
 
On
August 15, 2023, the Company issued a private placement memorandum offering to raise up to $1,500,000
through the issuance of restricted shares of the Company’s common stock (par value $0.001)
to qualified investors. From September 20, 2023, to October 4, 2023, the Company received subscription agreements from investors, for 850,000
common shares at a purchase price of $1
per share, including 1,700,000
warrants exercisable at $0.35
per share, vested immediately upon issuance, with a five year expiration. Proceeds to the Company totaled $850,000.
 
Effective
December 6, 2018, three existing stockholders have contributed to the Company a portion of their common shares held at a repurchase price
to the Company of $0.05 per share. The Company has cancelled the acquired shares, which decreased the outstanding common shares on the
books of the Company. The total number of common shares canceled/retired was 8,000,000. The total liability related to the repurchase
of these shares is $400,000, with repayment contingent on a major financing event.
 
Warrants
to Purchase Common Stock
 
The
following table summarizes the changes in warrants outstanding of the Company during years ended March 31, 2024, and 2023:
 SCHEDULE OF WARRANT OUTSTANDING


  
Number of Warrants  
Weighted Average Exercise Price ($) 

Outstanding at March 31, 2022 
 9,460,611  
 0.54 

Granted 
 2,153,403  
 1.05 

Outstanding at March 31, 2023 
 11,614,014  
 0.87 

Granted 
 4,639,929  
 0.51 

Outstanding at March 31, 2024 
 14,043,573  
 0.75 

Exercisable at March 31, 2024 
 16,253,943  
 0.75 

 

F-10
 

 
The
Company’s related party lenders consist of: the Chairman of the Board of Directors and a stockholder, Radiant Life, LLC and Mr.
Dickman, a board member and stockholder. These holders of the related party unsecured promissory notes, hold agreements that provide
each related party with common stock warrants upon the lender’s extension of a maturity due date or upon the loaning of additional
monies. The number of warrants issued for an extension is based on the following formula: 10,000 warrants per month the due date is extended
plus 1 warrant for every $2 of the principal balance outstanding (not including interest) at the time of the extension (rounded to the
nearest whole warrant). Upon the loaning of additional monies, the lender will also require 2 warrants for each dollar loaned. All warrants
issued under these terms vested immediately upon issuance, have an exercise price approximately equivalent to the fair value of the Company’s
common stock on the date of grant, and expire 5 years from the date of issuance.
 
During
the year ended March 31, 2024 the Company issued 281,900
warrants to the Chairman of the Board of Directors and 80,000
warrants to Radiant Life, LLC in conjunction with monies borrowed during the period (see Note 8 to the financial statements included
in this report). The exercise price of these warrants was $1.05.
The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $316,756.
The inputs used in this calculation included a fair value of the underlying common stock of $1.049
per share, a risk-free between 3.36%
and 4.29%,
volatility between 86.52%
and 89.11%
and a dividend rate of 0%.
 
During
the year ended March 31, 2024, the Company issued 1,106,000
warrants to Mr. Dickman, 772,275
warrants to the Chairman of the Board of Directors, and 699,754
warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note 8 to the financial
statements included in this report) per the terms outlined above. The exercise price of these warrants was between $0.41 and $1.05.
The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $964,277.
The inputs used in this calculation included a fair value of the underlying common stock between $0.409 and $1.049
per share, a risk-free between 3.80%
and 4.01%,
volatility between 84.00%
and 89.07%
and a dividend rate of 0%.
 
During
the year ended March 31, 2023 the Company issued 264,600 warrants to the Chairman of the Board of Directors and 120,000 warrants to Radiant
Life, LLC in conjunction with monies borrowed during the period (see Note 8) per the terms outlined above. The exercise price of these
warrants was $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $365,502.
The inputs used in this calculation included a fair value of the underlying common stock of $1.049 per share, a risk-free between 3.62%
and 4.31%, volatility between 142.23% and 148.56% and a dividend rate of 0%.
 
The
following table summarizes the warrants issued and outstanding as of March 31, 2024:
 SCHEDULE OF WARRANTS ISSUED AND OUTSTANDING


Exercise Price ($)  
Warrants Outstanding  
Warrants Exercisable  
Weighted Average Remaining Contractual Life (Years)  
Proceeds to Company if Exercised 

   
   
   
   
  

 0.05  
 3,708,754  
 3,708,754  
 1.20  
$185,439 

 0.35  
 1,700,000  
 1,700,000  
 4.50  
 595,000 

 0.41  
 2,035,029  
 2,035,029  
 4.83  
 834,362 

 1.00  
 1,000,000  
 1,000,000  
 0.02  
 1,000,000 

 1.05  
 5,049,790  
 5,049,790  
 3.48  
 5,302,280 

 2.00  
 50,000  
 50,000  
 2.34  
 100,000 

 5.00  
 500,000  
 500,000  
 2.82  
 2,500,000 

    
 14,043,573  
 14,043,573  
    
$10,517,081 

 
The
shares of common stock issuable upon exercise of the warrants are not registered with the Securities and Exchange Commission and the
holders of the warrants do not have registration rights with respect to the warrants or the underlying shares of common stock.
 

F-11
 

 
(9)
LIQUIDITY REQUIREMENTS AND GOING CONCERN
 
Since
the Company’s inception on January 31, 2013, its operations have been primarily financed through sales of equity, debt financing
from related parties and the issuance of notes payable and convertible debentures. As of March 31, 2024, the Company had $329,890 of
cash assets, compared to $533 as of March 31, 2023. As of March 31, 2024, the Company had access to draw an additional $4,265,942 on
the notes payable, related party (see Note 8) and $3,000,000 on the Convertible Debenture Agreement (see Note 8). For the year ended
March 31, 2024, the Company’s average monthly operating expenses were approximately $44,000, which includes salaries of our employees,
consulting agreements and contract labor, general and administrative expenses and legal and accounting expenses. In addition to the monthly
operating expenses, the Company continues to pursue other debt and equity financing opportunities, and as a result, financing expenses
of $135,000 and $54,000 were incurred during the years ended March 31, 2024, and 2023, respectively. As management continues to explore
additional financing alternatives, beginning April 1, 2024 the Company is expected to spend up to an additional $300,000 on these efforts.
Outstanding Accounts Payable as of March 31, 2024 totaled $447,862. Management has concluded that its existing capital resources and
availability under its existing convertible debentures and debt agreements with related parties will be sufficient to fund its operating
working capital requirements for the 12 months from the issuance of the financial statements. Related parties have given assurance that
their continued support, by way of either extensions of due dates, or increases in lines-of-credit, can be relied on. As mentioned above,
the Company also continues to evaluate other debt and equity financing opportunities.
 
The
accompanying financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize
its assets and satisfy its liabilities in the normal course of business.
 
(10)
INCOME TAXES
 
The
Company provides for income taxes under ASC 740, Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting
for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases
of assets and liabilities and the tax rates in effect when these differences are expected to reverse.
 
The
Company recorded $0 provision for income taxes for the years ended March 31, 2024, and 2023.
 
The
income tax provision differs from the amount of income tax determined by applying the U.S. federal tax rate of 21% to pretax income from
continuing operations for the years ended March 31, 2024, and 2023, due to the following:
 SCHEDULE OF COMPONENTS OF INCOME TAX EXPENSE (BENEFIT)


  
2024  
2023 

  
   
  

Income tax benefit at U. S. federal statutory rates: 
$(385,348) 
$(590,516)

State tax, net of federal benefit 
$(67,408) 
 (109,962)

Permanent and other differences 
 258,483  
 463,012 

Change in valuation allowance 
 194,273  
 223,229 

Other 
    
 14,237 

Income Tax 
$-  
$- 

 
The
tax effects of significant items comprising the Company’s net deferred taxes as of March 31, 2024, and 2023 were as follows:
 
 SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES


  
2024  
2023 

Deferred Tax assets: 
    
   

Net operating loss carry forwards 
$7,620,722  
$7,387,464 

Stock and warrant compensation 
 479,708  
 479,708 

Valuation allowance 
 (8,100,430) 
 (7,867,172)

Net deferred tax asset 
$-  
$- 

 
The
Company assesses the need for a valuation allowance against its deferred income tax assets at March 31, 2024. Factors considered in this
assessment include recent and expected future earnings and the Company’s liquidity and equity positions. The Company has placed
a 100% valuation allowance on the deferred tax assets. The deferred tax assets primarily relate to net operating loss carryforwards.
 
As
of March 31, 2024, the Company has U.S. federal net operating loss carryforwards of $30,822,643. These carry forwards are available
to offset future taxable income, if any, and begin to expire in 2025 . The utilization of the net operating loss carry forwards
is dependent upon the tax laws in effect at the time the net operating loss carry forwards can be utilized and may be significantly limited
based on ownership changes within the meaning of section 382 of the Internal Revenue Code.
 
Under
FASB ASC 740-10-05-6, tax benefits are recognized only for the tax positions that are more likely than not to be sustained upon examination
by tax authorities. The amount recognized is measured as the largest amount of benefit that is greater than 50 percent likely to be realized
upon ultimate settlement. Unrecognized tax benefits are tax benefits claimed in the company’s tax return that do not meet these
recognition and measurement standards.
 
The
Company had no liabilities for unrecognized tax benefits and the Company has recorded no additional interest or penalties.
 
(11)
SUBSEQUENT EVENTS
 
On
April 19, 2024, subsequent to year end, the company paid $125,000
to a vendor in an effort
to help secure bonding.
 
Between
June 24, 2024, and June 25, 2024, the Company issued an additional 180,000 total shares of stock and 360,000 total warrants to five investors
for cash.
 


F-12
 

 
Item
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
 
None.
 
Item
9A. Controls and Procedures
 
(a)
Disclosure Controls and Procedures
 
We
maintain disclosure controls and procedures, as such term is defined in Rules 13a-15I and 15d-15(e) of the Securities Exchange Act of
1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the reports filed or
submitted under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified by the Commission’s
rules and forms.
 
We
carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer
and principal financial officer, of the effectiveness of the design and operation of these disclosure controls and procedures, as such
term is defined in Exchange Act Rule 13a-15(e), as of March 31, 2024. Based on this evaluation, our principal executive officer and principal
financial officer concluded our disclosure controls and procedures were not effective as of March 31, 2024, the end of the period covered
by this Annual Report on Form 10-K due to the material weakness described below.
 
(b)
Management’s Report on Internal Control over Financial Reporting
 
Management
of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules
13a-15(f) and 15d-15(f) under the Exchange Act.
 
Internal
control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness of internal control over financial reporting to future periods are subject to the risk that controls
may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
 
Our
internal control over financial reporting is designed to provide reasonable assurance of achieving its objectives as specified above.
Management does not expect, however, that our internal control over financial reporting will prevent or detect all error and fraud. Any
control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute,
assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to
error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.
 

32
 

 
Management,
including our principal executive officer and principal financial officer, has assessed the effectiveness of our internal control over
financial reporting as of March 31, 2024. In making our assessment of the effectiveness of internal control over financial reporting,
management used the criteria set forth in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission (“COSO”). Based on this assessment, management has concluded that, as of March 31, 2024, our internal
control over financial reporting was not effective due to the material weakness described below.
 
(c)
Material Weaknesses
 
As
defined in SEC Regulation S-X, a material weakness is a deficiency, or combination of deficiencies, in internal control over financial
reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial
statements will not be prevented or detected on a timely basis. Management determined that the following material weaknesses existed
as of March 31, 2024: The design and operating effectiveness of our control environment and risk assessment, control activities and monitoring
activities were inadequate to ensure that complex accounting matters relating to the valuation of equity-based compensation instruments
are always properly accounted for and reviewed in a timely manner.
 
Our
principal executive and principal financial officer is in the process of performing a review of our processes and controls over complex
accounting matters relating to the valuation of equity-based compensation instruments.
 
Notwithstanding
the identified material weakness, the Company believes the financial statements included in this Annual Report on Form 10-K fairly represent
in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance
with accounting principles generally accepted in the United States of America.
 
This
Annual Report does not include an attestation report of our registered public accounting firm regarding our internal controls over financial
reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to rules of the
SEC that permit us to provide only management’s report in this Annual Report.
 
(d)
Changes in Internal Control Over Financial Reporting
 
Other
than described above in Item 9A. Controls and Procedures, there were no changes in our internal control over financial reporting that
occurred during the fourth quarter of the ended March 31, 2024, that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.
 
Item
9B. Other Information
 

During
the year ended March 31, 2024 the Company issued 281,900 warrants to the Chairman of the Board of Directors and 80,000 warrants to Radiant
Life, LLC in conjunction with monies borrowed during the period (see Note 8 to the financial statements included in this report) . The
exercise price of these warrants was $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton
valuation model was $316,756. The inputs used in this calculation included a fair value of the underlying common stock of $1.049 per
share, a risk-free between 3.36% and 4.29%, volatility between 86.52% and 89.11% and a dividend rate of 0%.
 
During
the year ended March 31, 2024, the Company issued 1,106,000 warrants to Mr. Dickman, 772,275 warrants to the Chairman of the Board of
Directors, and 699,754 warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note
8 to the financial statements included in this report) per the terms outlined above. The exercise price of these warrants was between
$0.41 and $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $964,277.
The inputs used in this calculation included a fair value of the underlying common stock between $0.409 and $1.049 per share, a risk-free
between 3.80% and 4.01%, volatility between 84.00% and 89.07% and a dividend rate of 0%.

  
Item
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
 
Not
Applicable.
  

33
 


 
PART
III
 
ITEM
10: DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
 
Identification
of Directors and Executive Officers
 
Our
executive officers and directors positions and biographical information are set forth below.
 


Name
 
Positions
    Held
 
Date
    of Election or Designation


Kraig
    T. Higginson
 
Chairman
    of the Board
 
1/12/2015


Glenn
    S. Dickman
 
Director
 
12/6/18


Stephen
    E. Quesenberry
 
Director
 
12/6/18


Randall
    F. Pearson
 
President
 
03/29/13


Randall
    F. Pearson
 
Principal
    Executive Officer
 
03/29/13


Randall
    F. Pearson
 
Principal
    Financial Officer
 
03/29/13


Randall
    F. Pearson
 
Director
    
 
04/01/13


 


 
*
Presently
    serves in the capacities indicated opposite his name.

 
The
Board of Directors has set the size of the Company’s Board of Directors at four, which is within the number allowed by our Bylaws.
 
Director
Qualifications
 
In
evaluating members for services on the Board of Directors, emphasis was placed on the following factors: (i) the appropriate size of
our Board of Directors; (ii) our needs with respect to the particular talents and experience of our directors; (iii) the knowledge, skills
and experience of the directors, including experience in development stage companies and new enterprises and innovations, finance, administration
and management skills; and (iv) the dedication of the directors to familiarize themselves with the our selected business industry.
 
Our
goal was to assemble a Board of Directors that brings together a variety of perspectives and skills derived from high quality business
and professional experience. We believe each of the members of our Board of Directors possesses these qualities.
 
Background
and Business Experience
 
Kraig
T. Higginson is 67 years of age and was appointed to the position of Chairman of the Board of Directors. Mr. Higginson served as Chief
Executive Officer of VIA Motors, Inc. (“Via Motors”), a hybrid electric vehicle company (PHEV), from November 2010 to January
2014, where he was responsible for overseeing the management and business of Via Motors and its employees. From October 2003 until November
2010, he served as Chairman of the Board of Directors of Raser Technologies, Inc. (“Raser Technologies”), which was an NYSE
listed company at that time. Mr. Higginson resigned as a director of Raser Technologies on February 11, 2011. Raser Technologies filed
bankruptcy proceedings on April 29, 2011, and was subsequently delisted from NYSE. Mr. Higginson also founded American Telemedia Network,
Inc. (“American Telemedia”), a publicly-traded NASDAQ company that developed a nationwide satellite network broadcasting
data, video programming and advertising to shopping centers and malls, and he served as President and Chief Executive Officer of American
Telemedia from 1984 through 1988. Mr. Higginson’s years of experience in the management of public companies is a great asset to
the Company.
 

34
 

 
Mr.
Glenn S. Dickman is 74 years of age. In 1984, Mr. Dickman started a “sales rack” jobbing operation supplying grocery stores
with movies for rent and purchase. As founder and CEO of Video II, the business grew from servicing one store to over 1,400 located in
38 states. Video II had over 400 employees at one time, with Mr. Dickman overseeing all facets of the business as its CEO. In 2005, Mr.
Dickman sold his interest in Video II, and has since concentrated his efforts on a variety of investments, including stocks and real
estate. Mr. Dickman’s years of experience running various business entities is an invaluable resource to the board of directors.
 
Stephen
Quesenberry is 61 years old. He has practiced law since 1989 in Washington and Utah, including complex business litigation and SEC matters.
Mr. Quesenberry was one of the (many) attorneys representing Exxon Shipping in the Exxon Valdez litigation in Alaska in the early 1990s.
Mr. Quesenberry has also been a principal in various property development projects in Washington and elsewhere. Mr. Quesenberry graduated
from Brigham Young University in 1986 with a degree in English and was a pitcher for the BYU Cougars varsity baseball team from 1983-1986.
He attended law school at the University of Kansas from 1986-1989, where he was an editor of the Kansas Law Review and a member of the
Order of the Coif. He also speaks fluent German. Mr. Quesenberry’s legal expertise makes him a great resource for the board of
directors.
 
Mr.
Randall F. Pearson is 69 years old. He is currently serving as a member of the Board of Directors and as President and Principal Financial
Officer. Mr. Pearson has served as President of the Company since inception in 2013. Prior to Sundance he worked with JWD Management
Corp. for 26 years. During his time with JWD Management he served in several positions including Vice President of Operations, Vice President,
President and CEO. JWD Management was a nationally recognized distribution supplier providing products to grocery stores in 33 states
and managing over 450 employees. Prior to JWD Management he worked with Capital Resources investing in and managing his own and client
owned residential and commercial real estate properties. Mr. Pearson attended Brigham Young University until 1977, received his real
estate brokers license in 1977 and his Series 7 securities license in 1978. Mr. Pearson’s many years of management and insight
into the operations of the Company create a unique and valuable perspective in his role as a director.
 
Significant
Employees
 
The
Company has no significant employees.
 
Family
Relationships
 
There
are no family relationships between any of our directors, executive officers and proposed directors or executive officers.
 
Directorships
Held in Other Reporting Companies
 
None
of our directors or executive officer is a director of a company that is required to file reports under Sections 15 or 13(d) of the Exchange
Act.
 
Promoters
and control person
 
To
the best of our management’s knowledge, no person who may be deemed to have been a promoter or founder of our Company was the subject
of any of the legal proceedings listed under the heading “Involvement in Certain Legal Proceedings” above;
 

35
 

 
Corporate
Governance
 
Overview
 
Our
Bylaws provide that the size of our Board is to be determined by resolution of the Board. Our Board has fixed the exact number of directors
at four. Our Board currently consists of four members.
 
We
are subject to a number of technological, regulatory, product, legal and other types of risks. The Board is responsible for overseeing
these risks, and we employ a number of procedures to help them carry out that duty. For example, Board members regularly consult with
executive management about pending issues and expected challenges, and at each Board meeting directors receive updates from, and have
an opportunity to interview and ask questions of, key personnel and management. Furthermore, because our President serves as a member
of our Board, we believe that the Board has a direct channel and better access to insights into our performance, business and challenges.
 
Board
Leadership Structure
 
The
Board does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as the Board
believes it is in the best interests of the Company to make that determination based upon the position and direction of the Company and
the membership of the Board. The Board has determined at this time that the Company’s Chairman should not be its President.
 
The
Board has determined that of the current directors or nominees, Messrs. Higginson, Dickman and Quesenberry would qualify as independent
directors as that term is defined in the listing standards of The NASDAQ Capital Market if we were listed on The NASDAQ Capital Market.
Such independence definition includes a series of objective tests, including that the director is not an employee of the Company and
has not engaged in various types of business dealings with the Company. As Mr. Pearson is also employed by the Company, the Board has
determined that Mr. Pearson is not currently independent. Although the Company’s common stock is not listed on The NASDAQ Capital
Market, the Company has applied The NASDAQ Capital Market independence rules to make its independence determinations.
 
Committees
of the Board of Directors
 
The
Board has not established an Audit Committee, a Compensation Committee or a Nominating Committee. Therefore, the Board has not adopted
written charters for any of these committees. Because we have only four directors and one executive officer, we believe that we are able
to effectively manage the issues normally considered by such committees. The Board also does not have an audit committee financial expert.
We believe we are currently able to manage our audit and financial reporting obligations without an audit committee financial expert.
However, as we grow, we will consider adding an audit committee financial expert.
 
In
evaluating a director candidate, our Board of Directors will review his or her qualifications including capability, availability to serve,
conflicts of interest, general understanding of business, understanding of the Company’s business and technology, educational and
professional background, personal accomplishment and other relevant factors. Our Board of Directors has not established any specific
qualification standards for director nominees and we do not have a formal diversity policy relating to the identification and evaluation
of nominees for director, although from time to time the Board of Directors may identify certain skills or attributes as being particularly
desirable to help meet specific needs that have arisen. Our Board of Directors may also interview prospective nominees in person or by
telephone. After completing this evaluation, the Board of Directors will determine the nominees.
 
The
Board has not adopted a formal process for considering director candidates who may be recommended by stockholders. However, our policy
is to give due consideration to any and all such candidates. A stockholder may submit a recommendation for director candidates to us
at our corporate offices, to the attention of Randall F. Pearson. We do not pay fees to any third parties to assist us in identifying
potential nominees.
 
Number
of Meetings
 
The
Board held a total of one (1) meeting during the fiscal year ended March 31, 2024. Each incumbent director attended the Board meetings.
Although we do not have a formal policy regarding attendance by directors at our annual meeting, we encourage directors to attend.
 

36
 

 
Codes
of Ethics and Business Conduct
 
We
have adopted a corporate Code of Ethics and Business Conduct which is available as Exhibit 14.1 to this filing. The Code of Ethics and
Business Conduct applies to all our officers, directors and employees, including our principal executive officer, principal financial
officer and controller, or persons performing similar functions. If we effect an amendment to, or waiver from, a provision of our Code
of Ethics and Business Conduct, we intend to satisfy our disclosure requirements by posting a description of such amendment or waiver
on our website at www.sundancestrategies.com.
 
ITEM
11: EXECUTIVE COMPENSATION
 
Director
Compensation
 
There
were no equity awards granted during fiscal years ended March 31, 2024, nor 2023.
 
At March 31, 2024, Mr. Pearson’s beneficial ownership totaled 1,191,432 shares.
 
At March 31, 2024, Mr. Dickman’s beneficial ownership totaled 5,964,213 shares, including 3,196,332 warrants.
 
At March 31, 2024, Mr. Quesenberry’s beneficial ownership totaled 970,206 shares.
 
At March 31, 2024, Mr. Higginson’s beneficial ownership totaled 13,758,225 shares, including 7,000,000 shares owned by Higginson Family Inv, LLC; 750,000 shares owned by Eclipse Fund LLC; 320,000 shares owned by Radion Energy LLC; 370,000 shares owned by Ecosystems Resources LLC; and 900,000 shares owned by KGPR, LLC. Also included are 4,418,225 warrants held by Mr. Higginson.
 
Executive
Compensation Objectives and Principles
 
The
overall objective of our executive compensation program is to help create long-term value for our stockholders by attracting and retaining
talented executives, rewarding superior operating and financial performance, and aligning the long-term interests of our executives with
those of our stockholders. Accordingly, our executive compensation program incorporates the following principles:
 


 
●
Compensation
    should be based upon individual job responsibility, demonstrated leadership ability, management experience, individual performance,
    and Company performance.

 
 
 

 
●
Compensation
    should reflect the fair market value of the services received. We believe that a fair and competitive pay package is essential to
    attract and retain talented executives in key positions.

 
 
 

 
●
Compensation
    should reward executives for long-term strategic management and enhancement of stockholder value.

 
 
 

 
●
Compensation
    should reward performance and promote a performance-oriented environment.

 

37
 

 
Executive
Compensation Procedures
 
We
believe that compensation paid to our executive officers should be closely aligned with our performance and the performance of each individual
executive officer on both a short-term and a long-term basis, should be based upon the value each executive officer provides to us, and
should be designed to assist us in attracting and retaining the best possible executive talent, which we believe is critical to our long-term
success. To attain our executive compensation objectives and implement the underlying compensation principles, we follow the procedures
described below.
 
Role
of the Board. The Board has responsibility for establishing and monitoring our executive compensation programs and for making
decisions regarding the compensation of Randall F. Pearson, our Named Executive Officer. The Board sets the compensation package of
the Named Executive Officers.
 
The
Board relies on its judgment in making compensation decisions after reviewing our performance and evaluating our executives’ leadership
abilities and responsibilities with our Company and their current compensation arrangements. The Board’s assessment process is
designed to be flexible so as to better respond to the evolving business environment and individual circumstances. The last Annual Meeting
of Stockholders was held in 2016.
 
Role
of Compensation Consultant. We have not engaged a compensation consultant.
 
Elements
of Compensation
 
Our
executive compensation objectives and principles are implemented through the use of the following elements of compensation, each discussed
more fully below:
 


 
●
Base
    Salary

 


 
●
Annual
    Incentive Bonuses

 
 
 

 
●
Stock-Based
    Compensation

 
 
 

 
●
Other
    Benefits

 
Base
Salary. The Board approved the salaries of all our executive officers for Fiscal Year 2024. Base salaries are offered to ensure that
our executive officers receive an ongoing level of compensation. Salary decisions concerning these officers were based upon a variety
of considerations consistent with the compensation philosophy stated above. First, salaries were competitively set relative to both other
companies in our industry and other comparable companies. The Board considered each officer’s level of responsibility and individual
performance, including an assessment of the person’s overall value to the Company. In addition, internal equity among employees
was factored into the decision. Finally, the Board considered our financial performance and our ability to absorb any increases in salaries.
 
Annual
Incentive Bonuses. Annual incentive bonuses are designed to reward extraordinary performance by our executives. For Fiscal Year 2024,
the Board did not precisely define the parameters of a bonus program for the Named Executive Officer, and no bonuses were awarded to
the Named Executive Officer.
 
Stock-Based
Compensation. Each Named Executive Officer or Director is eligible to receive stock-based compensation. Stock-based compensation
is designed to more closely align the interests of management with those of our stockholders. We do not have any securities authorized
for issuance under an equity compensation plan, or any policies for allocating compensation between long-term and currently paid out
compensation or between cash and non-cash compensation or among different forms of non-cash compensation. No stock-based compensation
was granted during the years ended March 31, 2024.
 
Other
Benefits. Our Named Executive Officer receive the same benefits that are available to all other full-time employees, including the
payment of health, dental, life and disability insurance premiums.
 

38
 

 
Deductibility
of Executive Compensation
 
Section
162(m) of the Internal Revenue Code disallows a tax deduction to publicly held companies for compensation paid to certain covered executives
to the extent such compensation exceeds $1.0 million per covered officer in any year. The Board understands that it is possible that
the compensation payable to our named executive officers will exceed the $1.0 million limit under Section 162(m). We believe that in
establishing the cash and equity incentive compensation programs for our named executive officers, the potential deductibility of the
compensation payable under those programs should be only one of a number of relevant factors taken into consideration, and not the sole
governing factor. For that reason, we may deem it appropriate to provide one or more named executive officers with the opportunity to
earn incentive compensation, whether through annual cash incentive programs tied to our financial performance or through equity awards,
which together with base salary in the aggregate may be in excess of the amount deductible by reason of Section 162(m) or other provisions
of the Internal Revenue Code. We believe it is important to maintain cash and equity incentive compensation at the levels needed to attract
and retain the named executive officers essential to our success, even if all or part of that compensation may not be deductible by reason
of the Section 162(m) limitation.
 
The
compensation that we pay to the named executive officers is reflected in our consolidated financial statements as required by GAAP. The
Board considers the financial impact, along with other factors, in determining the amount and form of compensation provided to executives.
We account for stock-based compensation in accordance with the requirements of FASB ASC Topic 718.
 
Summary
Compensation Table
 
The
following information presents the compensation paid to Randall F. Pearson, our Named Executive Officer, in Fiscal Year 2024, and
2023.
 


Name and Principal Position 
Year  
Salary ($)  
Bonus ($)  
Stock
Awards ($)  
Option Awards ($)  
Non-Equity Incentive Plan Compensation ($)  
All Other Compensation ($)  
Total
($) 

  
   
   
   
   
   
   
   
  

Randall F. Pearson 
 2024  
 136,900  
 —  
 —  
 —  
 —  
 —  
 136,900 

President, Principal Executive Officer and Principal Financial Officer 
 2023  
 136,900  
 —  
 —  
 —  
 —  
 —  
 136,900 

 
ITEM
12: SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
 
Security
Ownership of Certain Beneficial Owners
 
The
following table shows information regarding the beneficial ownership of our common stock as of the date of this filing by (a) each stockholder,
or group of affiliated stockholders, that we know owns more than 10% of our outstanding common stock; (b)  our Named Executive
Officer; (c) each of our directors; and (d) all of our current directors and executive officer as a group. The table is based upon
information supplied by directors, executive officers and principal stockholders, and Schedules 13D and 13G filed with the  Commission.
 

39
 

 
Percentage
ownership in the table below is based on 42,438,441 shares of common stock outstanding as of July 1, 2024. Beneficial ownership is determined
in accordance with the rules of the Securities and Exchange Commission, and generally includes voting power and/or investment power with
respect to the securities held. Any securities not outstanding but which are subject to options or warrants exercisable within 60 days
of June 29, 2023 are deemed outstanding and beneficially owned for the purpose of computing the percentage of outstanding common stock
beneficially owned by the stockholder holding such options or warrants, but are not deemed outstanding for the purpose of computing the
percentage of common stock beneficially owned by any other stockholder.
 
Unless
otherwise indicated, each of the stockholders listed below has sole voting and investment power with respect to the shares beneficially
owned. The address for each director or named executive officer is c/o Sundance Strategies, Inc., Attention: Randall F. Pearson, 4626
North 300 West, Suite No. 365, Provo, Utah 84604.
 


  
Shares Beneficially Owned 

Name and Address of Beneficial Owner 
Number  
Percent 

Directors and Named Executive Officers 
    
   

Kraig T. Higginson (1) 
 13,758,225  
 29.4%

Glenn S. Dickman (4) 
 5,964,213  
 13.1%

Randall F. Pearson 
 1,191,432  
 2.6%

Stephen E Quesenberry 
 970,206  
 2.1%

  
    
   

All executive officers and directors as a group (4 persons) 
 21,884,076  
 43.7%

  
    
   

5% Stockholders Not Listed Above 
    
   

Zoe, LLC (2) 
 5,100,000  
 12.0%

Radiant Life, LLC (2) 
 5,681,016  
 12.4%

Smartrade Consulting, Inc. (3) 
 2,500,000  
 5.9%


 


(1)
Mr.
    Higginson’s ownership includes 7,000,000 shares owned by Higginson Family Inv, LLC; 750,000 shares owned by Eclipse Fund LLC;
    320,000 shares owned by Radion Energy LLC; 370,000 shares owned by Ecosystems Resources LLC; and 900,000 shares owned by KGPR, LLC.
    Also included are 4,418,225 warrants held by Mr. Higginson.

 
 

(2)
ZOE,
    LLC and Radiant Life, LLC are beneficially owned by Mitchell D. Burton, for an aggregate percentage of ownership of approximately
    25.5%. The address of ZOE, LLC is 4626 N. 300 W., Provo, Utah 84604. The address of Radiant Life, LLC is 4626 N. 300 W., Provo, Utah
    84604. Mr. Burton’s ownership includes 3,229,016 warrants held by Radiant Life, LLC.

 
 

(3)
    
Smartrade
                                            Consulting, Inc. is held by Summit Trustees PLLC for the beneficial owner, Lam Ping of Hong
                                            Kong. The address of Smartrade Consulting, Inc. is 22G Tower 4, The Metropolis, 8 Mau Yip
                                            Road, Tsung Kwan Q, N. T., Hong Kong.
 

(4)
Mr.
    Dickman’s ownership includes 3,196,332 warrants.

 

40
 

 
Securities
Authorized for Issuance under Equity Compensation Plans
 
The
following table provides information as of March 31, 2024, about our common stock that may be issued upon the exercise of options, warrants
and rights under all of our existing equity compensation plans (including individual arrangements):
 


Plan Category 
Number of securities to be issued upon exercise of outstanding options, warrants and rights (a)  
Weighted-average exercise price of outstanding options, warrants and rights (b)  
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (c) 

  
   
   
  

Equity compensation plans approved by security holders 
 -  
 -  
 - 

  
    
    
   

Equity compensation plans not approved by security holders 
 7,614,557  
$0.55  
 - 

  
    
    
   

Total 
 7,614,557  
$0.55  
 - 

 
ITEM
13: CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTORS INDEPENDENCE
 
Review
and Approval of Related Person Transactions
 
Before
engaging in a related person transaction, the transaction is presented to non-interested board members for approval. In considering related
person transactions, the non-interested board members are guided by their fiduciary duty to our stockholders. The Board of Directors
does not have any written or oral policies or procedures regarding the review, approval and ratification of transactions with related
person. Additionally, each of our directors and executive officers are required to annually complete a directors’ and officers’
questionnaire that elicits information about related person transactions. Approval of a related person transaction is provided either
verbally or in writing.
 
Related
Person Transactions
 
Other
than as described below, there were no material transactions, or series of similar transactions, during our last two fiscal years, or
any currently proposed transactions, or series of similar transactions, to which we or any of our subsidiaries was or is to be a party,
in which the amount involved exceeded the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed
fiscal years and in which any director, executive officer or any security holder who is known to us to own of record or beneficially
more than 5% of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest,
except as stated below.
 
As
of March 31, 2024, and 2023, the Company had borrowed $3,340,058 and $3,194,108, respectively, excluding accrued interest, from related
parties. The interest associated with the Notes Payable, Related Party of $1,369,662, and $1,050,762 is recorded on the balance sheet
as an Accrued Expense obligation at March 31, 2024 and March 31, 2023, respectively.
 

41
 

 
Warrants
to Purchase Common Stock
 
The
Company’s related party lenders consist of: Kraig Higginson, the Chairman of the Board of Directors and a stockholder, Radiant
Life, LLC and Mr. Dickman, a board member and stockholder. These holders of the related party unsecured promissory notes, hold agreements
that provide each related party with common stock warrants upon the lender’s extension of a maturity due date or upon the loaning
of additional monies. The number of warrants issued for an extension is based on the following formula: 10,000 warrants per month the
due date is extended plus 1 warrant for every $2 of the principal balance outstanding (not including interest) at the time of the extension
(rounded to the nearest whole warrant). Upon the loaning of additional monies, the lender will also require 2 warrants for each dollar
loaned. All warrants issued under these terms vested immediately upon issuance, have an exercise price approximately equivalent to the
fair value of the Company’s common stock on the date of grant, and expire 5 years from the date of issuance.
 
During
the year ended March 31, 2024 the Company issued 281,900 warrants to the Chairman of the Board of Directors and 80,000 warrants to Radiant
Life, LLC in conjunction with monies borrowed during the period (see Note 8 to the financial statements included in this report) . The
exercise price of these warrants was $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton
valuation model was $316,756. The inputs used in this calculation included a fair value of the underlying common stock of $1.049 per
share, a risk-free between 3.36% and 4.29%, volatility between 86.52% and 89.11% and a dividend rate of 0%.
 
During
the year ended March 31, 2024, the Company issued 1,106,000 warrants to Mr. Dickman, 772,275 warrants to the Chairman of the Board of
Directors, and 699,754 warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note
8 to the financial statements included in this report) per the terms outlined above. The exercise price of these warrants was between
$0.41 and $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model was $964,277.
The inputs used in this calculation included a fair value of the underlying common stock between $0.409 and $1.049 per share, a risk-free
between 3.80% and 4.01%, volatility between 84.00% and 89.07% and a dividend rate of 0%.
 
During
the fiscal year ended March 31, 2023, the Company issued 339,749 warrants to Mr. Dickman, 719,300 warrants to the Chairman of the Board
of Directors, and 699,754 warrants to Radiant Life, LLC in conjunction with an extension of the maturity dates during the period (see Note 8 to the financial statements included in this report) per the terms outlined above. The exercise price of these warrants was $1.05. The value of the warrants on the date of grant,
as calculated by the Black-Scholes-Merton valuation model was $1,678,810. The inputs used in this calculation included a fair value of
the underlying common stock of $1.049 per share, a risk-free between 3.49% and 3.95%, volatility between 142.92% and 145.49% and a dividend
rate of 0%.
 
During
the fiscal year ended March 31, 2023, the Company issued 264,600 warrants to the Chairman of the Board of Directors and 120,000 warrants
to Radiant Life, LLC in conjunction with monies borrowed during the period (see Note 8) per the terms outlined above. The exercise price
of these warrants was $1.05. The value of the warrants on the date of grant, as calculated by the Black-Scholes-Merton valuation model
was $365,502. The inputs used in this calculation included a fair value of the underlying common stock of $1.049 per share, a risk-free
between 3.62% and 4.31%, volatility between 142.23% and 148.56% and a dividend rate of 0%.
 
As
of March 31, 2024, and 2023, the Company held outstanding warrants to related parties totaling 10,843,573 and 7,903,644, respectively.
3,708,754 of these warrants have an exercise price of $0.05, 2,035,029 of these warrants have an exercise price of $0.41, 5,049,790 have
an exercise price of $1.05, and 50,000 of these warrants have an exercise price of $2.00 per share. All warrants have a five-year life
as of the date of grant and expire between November 2024 and February 2029.
 
The
shares of common stock issuable upon exercise of the warrants are not registered with the  Commission and the
holders of the warrants do not have registration rights with respect to the warrants or the underlying shares of common stock.
 
Parents
 
We
have no parents.
 

42
 

 
Director
Independence
 
The
Board has determined that of the current directors, Messrs. Higginson, Dickman and Quesenberry would qualify as independent directors
as that term is defined in the listing standards of The NASDAQ Capital Market if we were listed on The NASDAQ Capital Market. Such independence
definition includes a series of objective tests, including that the director is not an employee of the Company and has not engaged in
various types of business dealings with the Company. As Mr. Pearson is also employed by the Company, the Board has determined that Mr.
Pearson is not currently independent. Although the Company’s common stock is not listed on The NASDAQ Capital Market, the Company
has applied The NASDAQ Capital Market independence rules to make its independence determinations.
 
ITEM
14: PRINCIPAL ACCOUNTING FEES AND SERVICES
 
The
following is a summary of the fees billed to us by our principal accountants during fiscal years ended March 31, 2024, and 2023:
 


Fee Category 
2024  
2023 

Audit Fees 
$60,000  
$58,100 

Audit-related Fees 
 -  
 - 

Tax Fees 
 -  
 - 

All Other Fees 
 -  
 - 

Total Fees 
$60,000  
$58,100 


 
Audit
Fees - Consists of fees for professional services rendered by our principal accountants for the audit of our annual financial statements
and review of the financial statements included in our Forms 10-Q or services that are normally provided by our principal accountants
in connection with statutory and regulatory filings or engagements including out of pocket expenses.
 
Audit-related
Fees - Consists of fees for assurance and related services by our principal accountants that are reasonably related to the performance
of the audit or review of our financial statements and are not reported under “Audit fees.”
 
Tax
Fees - Consists of fees for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning.
 
All
Other Fees - Consists of fees for products and services provided by our principal accountants, other than the services reported under
“Audit fees,” “Audit-related fees,” and “Tax fees” above.
 
Policy
on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
 
We
have not adopted an Audit Committee; therefore, there is no Audit Committee policy in this regard. However, we do require approval in
advance of the performance of professional services to be provided to us by our principal accountant. Additionally, all services rendered
by our principal accountant are performed pursuant to a written engagement letter between us and the principal accountant.
 

43
 

 
PART
IV
 
Item
15. Exhibits and Financial Statement Schedules
 


(a)
The
    following documents are filed as part of this report:

 


 
(1)
Financial
    Statements

 
The
financial statements listed on the accompanying Index to Consolidated Financial Statements are filed as part of this report.
 


 
(2)
Financial
    statement schedules 

 
There
are no financial statements schedules included because they are either not applicable or the required information is shown in the consolidated
financial statements or the notes thereto.
 


 
(3)
Exhibits
    

 
The
following exhibits are filed or incorporated by reference as part of this Form 10-K.
 


Exhibit
    No.
 
Exhibit
    Description

3.1
 
Amended and Restated Articles of Incorporation (incorporated by reference to Exhibit 3(i) to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

3.2
 
Certificate of Amendment to the Amended and Restated Articles of Incorporation(incorporated by reference to Exhibit 3(i)(a) to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

3.3
 
Certificate of Amendment to the Amended and Restated Articles of Incorporation(incorporated by reference to Exhibit 3(i)(b) to the Company’s Current Report on Form 8-KA-1 filed May 24, 2013, file no. 000-50547)

3.4
 
Amended Bylaws (incorporated by reference to Exhibit 3(ii) to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

4.1
 
Description of Securities Registered Under Section 12 of the Exchange Act

10.1
 
Agreement and Plan of Merger (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

10.2
 
Form of Lock-Up/Leak-Out Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

10.22
 
8% Convertible Debenture (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q filed August 10, 2015, file no. 000-50547)

10.24
 
Amendment to the notes payable and lines-of-credit agreements, dated February 4, 2016, between the Company, Kraig Higginson and Radiant Life, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed February 9, 2016, file no. 000-50547)

10.25
 
Amendment to the Convertible Debenture Agreement, dated February 2, 2016, between the Company and Sactco International, Limited (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed February 9, 2016, file no. 000-50547)

10.27
 
Promissory Note between Sundance Strategies, Inc. and Glenn S. Dickman, dated April 10, 2019. (incorporated by reference to Exhibit 10.27 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547).

10.28
 
Promissory Note between Sundance Strategies, Inc. and Glenn S. Dickman, dated November 5, 2019 (incorporated by reference to Exhibit 10.28 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.29
 
Promissory Note between Sundance Strategies, Inc. and Glenn S. Dickman, dated February 4, 2020(incorporated by reference to Exhibit 10.29 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.30
 
Extension to Promissory Note between Sundance Strategies, Inc. and Kraig T. Higginson, dated January 8, 2020 (incorporated by reference to Exhibit 10.30 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.31
 
First Amendment to the Note Payable and Line of Credit Agreement between Sundance Strategies, Inc. and Kraig Higginson, dated April 3, 2020 (incorporated by reference to Exhibit 10.31 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.32
 
Extension to Promissory Notes between Sundance Strategies, Inc. and Glenn S. Dickman, dated November 5, 2019 (incorporated by reference to Exhibit 10.32 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.33
 
Amendment to $3,000,000 Convertible Debenture Agreement between Sundance Strategies, Inc. and Satco International, Limited, dated July 13, 2020 (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.34
 
Extension Agreement to Promissory Note between Sundance Strategies, Inc. and Radiant Life, dated December 19, 2019 (incorporated by reference to Exhibit 10.34 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

 

44
 

 


10.35
 
Promissory Note between Sundance Strategies, Inc. and Satco International, Limited, dated April 6, 2021 (incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.36
 
Extension to Promissory Note between Sundance Strategies, Inc. and Satco International, Limited, dated August 9, 2021 (incorporated by reference to Exhibit 10.36 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.37
 
Promissory Note between Sundance Strategies, Inc. and Radiant Life, LLC, dated July 29, 2021 (incorporated by reference to Exhibit 10.36 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.38
 
Private Placement Memorandum, effective November 5, 2022 (incorporated by reference to Exhibit 10.37 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.39
 
Agreement between Sundance Strategies, Inc. and Tradability, LLC, dated January 1, 2022 (incorporated by reference to Exhibit 10.38 to the Company’s Annual Report on Form 10-K filed June 29, 2022, File No. 000-50547)

10.40
 
Extension to Promissory Notes between Sundance Strategies, Inc. and Glenn S. Dickman, dated June 5, 2023 (incorporated by reference to Exhibit 10.40 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.41
 
Extension to Promissory Note between Sundance Strategies, Inc. and Kraig T. Higginson, dated February 2, 2023 (incorporated by reference to Exhibit 10.41 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.42
 
Extension Agreement to Promissory Note between Sundance Strategies, Inc. and Radiant Life, dated February 2, 2023 (incorporated by reference to Exhibit 10.42 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.43
 
Extension to Promissory Note between Sundance Strategies, Inc. and Satco International, Limited, dated February 2, 2023 (incorporated by reference to Exhibit 10.43 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.44
 
Amendment to $3,000,000 Convertible Debenture Agreement between Sundance Strategies, Inc. and Satco International, Limited, dated February 9, 2023 (incorporated by reference to Exhibit 10.44 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.45
 
Extension Agreement to Promissory Note between Sundance Strategies, Inc. and Radiant Life, dated June 12, 2023 (incorporated by reference to Exhibit 10.45 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.46
 
Extension to Promissory Note between Sundance Strategies, Inc. and Satco International, Limited, dated June 9, 2023 (incorporated by reference to Exhibit 10.46 to the Company’s Annual Report on Form 10-K filed June 29, 2023, File No. 000-50547)

10.47
 
Extension to Promissory Note between Sundance Strategies, Inc. and Kraig T. Higginson, dated January 26, 2024*

10.48
 
Extension to Promissory Notes between Sundance Strategies, Inc. and Glenn S. Dickman, dated January 26, 2024*

10.49
 
Extension to Promissory Note between Sundance Strategies, Inc. and Radiant Life, dated February 1, 2024*

14.1
 
Code of Ethics (incorporated by reference to Exhibit 14 to the Company’s Current Report on Form 8-K filed April 5, 2013, file no. 000-50547)

31
 
Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Rule 13a-14(a)*

32
 
Certification
    of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350‡

101
    INS
 
Inline
    XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within
    the Inline XBRL document**

101
    SCH
 
Inline
    XBRL Schema Document**

101
    CAL
 
Inline
    XBRL Calculation Linkbase Document**

101
    DEF
 
Inline
    XBRL Defindition Linkbase Document**

101
    LAB
 
Inline
    XBRL Labels Linkbase Document**

101
    PRE
 
Inline
    XBRL Presentation Linkbase Document**

104
 
Cover
    Page Interactive Data File––the cover page interactive data file does not appear in the Interactive Data File because
    its XBRL tags are embedded within the Inline XBRL document.

 
*
Filed herewith.
‡
Document has been furnished, is not deemed filed and is not to be incorporated by reference into any of the Company’s filings under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, irrespective of any general incorporation
language contained in any such filing.
**
The XBRL related information in Exhibit 101 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended, or otherwise subject to liability of that section and shall not be incorporated by reference into any filing
or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in
such filing or document.
 
Item
16. Form 10-K Summary
 
None.
 

45
 

 
SIGNATURES
 
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed
by the undersigned, thereunto duly authorized.
 


 
SUNDANCE
    STRATEGIES, INC.

 
 
 

Date:
    July 1, 2024
By:
/s/
    Randall F. Pearson 

 
 
Randall
    F. Pearson 

 
 
President,
    Principal Executive Officer and Principal Financial Officer

 
 
(Duly
    Authorized Representative)

 
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dated indicated.
 


Signatures
 
Title
 
Date

 
 
 
 
 

/s/
    Kraig T. Higginson 
 
Chairman
    of the Board of Directors
 
July
    1, 2024

Kraig
    T. Higginson
 
 
 
 

 
 
 
 
 

/s/
    Randall F. Pearson 
 
President
    (Principal Executive Officer),
 
July
    1, 2024

Randall
    F. Pearson
 
Director
    and Principal Financial Officer
 
 

 
 
 
 
 

/s/
    Glenn S. Dickman 
 
Director
 
July
    1, 2024

Glenn
    S. Dickman 
 
 
 
 

 
 
 
 
 

/s/
    Stephen E. Quesenberry
 
Director
 
July
    1, 2024

Stephen
    E. Quesenberry 
 
 
 
 

 

46

 


